Home GBP/JPY: Technical levels still holding
Forex News Today: Daily Trading News

GBP/JPY: Technical levels still holding

Yesterday was a highly volatile session for the Japanese Yen. The currency sold off when expectations of a 28 trillion Yen stimulus packages hit the wires and this took the GBP/JPY for a 300 pip ride. It ´s not clear how much of this package will be direct government spending.Weak shorts got stopped out.

Earlier this week I wrote about the 138.75 bull/bear line and when sellers finally absorbed all the buy orders at this area price broke and hit the first level of profit taking / buyers position at 136.38 for a 231 pip win for sellers. Then the stimulus package size expectation went viral.

What ´s interesting here is that even though the size of this package is much much larger than in the past and a super strong bearish pressure intensified the yen dip the 138.75 bull/bear line held after the dust settled. See this 4H chart and a clear rejection after continuous pressure by buyers trying to break above it.

If we have a closer look at what happened here we can see that this is a high volume zone past session POCs are all over the place. Sell orders placed at POC and 61.8% couldn ´t be cleared by weak and momo buyers and price rejected this high-value zone.

It really all depends on of what Friday’s BoJ monetary policy statement brings to the table. This will definitely give us directionality for the future but for the time being we maintain our bearish stand purely based on technicals. After the statement is released we will adapt to the new market conditions.

GBPJPY 4H

Orlando Gutierrez

Orlando Gutierrez

Orlando has been involved in the markets for about six years starting up as a retail trader and now is the Head Trader at www.snipethetrade.com. Orlando has mentored a vast amount of beginner traders and sent them into the technical analysis of price action path; some of them are now part time traders making a second income for themselves. He has also collaborated with the best trading academies as a Forex Specialist and Currency Analyst. He is a strong believer in passing knowledge around to people that truly care about it, and this is why he still posts market analysis regularly on the biggest trading forums and trading schools.