GBPJPY Detailed Analysis - Long and Short Setup
Yellow zones- critical zones based on the monthly/ weekly timeframe
Red zones- critical zones based on the daily timeframe
Blue zones – critical zones based on the 4h timeframe
Orange zones – critical zones based on the 1h timeframe
According to last week’s GBP COT report we can see a strong increase in the long “contract” sizes. Even a decrease in short positions can be seen within the long-term investors. This was the confirmation to our technical analysis that the price will go for a second attempt to breach the 136.000 mark. Down bellow you will see our previous analysis and how we determined the price direction.
As we talked about- on the daily timeframe price is still in a closed triangle since the beginning of March. On the 17th July it dropped to a triple confirmation point, where price touched the bottom trendline of both 1H and the daily closed triangles and it also aligned with the 0.618 Fibonacci level. Strong support came in afterwards, breaking the 1H closed triangle and the second attempt to break the 136.000 mark was successful.
Now we have 2 possible scenarios:
1. A small correction towards the 1H critical area near 135.960 which also lies within the daily critical zone. Afterwards a touch with the upper trendline of the daily timeframe can be expected.
2. The more profitable way of the price playing out is if we see a bigger correction towards the 1H critical zone near 135.000. It is not only a psychological point, but it also aligns with the 0.618 Fibonacci retracement . After that price will move once again towards the upper trendline .
If any of the scenarios takes place a small correction or a move towards 135.000 must take happen after the price meets our upper trendline .
Happy Trading!
Red zones- critical zones based on the daily timeframe
Blue zones – critical zones based on the 4h timeframe
Orange zones – critical zones based on the 1h timeframe
According to last week’s GBP COT report we can see a strong increase in the long “contract” sizes. Even a decrease in short positions can be seen within the long-term investors. This was the confirmation to our technical analysis that the price will go for a second attempt to breach the 136.000 mark. Down bellow you will see our previous analysis and how we determined the price direction.
As we talked about- on the daily timeframe price is still in a closed triangle since the beginning of March. On the 17th July it dropped to a triple confirmation point, where price touched the bottom trendline of both 1H and the daily closed triangles and it also aligned with the 0.618 Fibonacci level. Strong support came in afterwards, breaking the 1H closed triangle and the second attempt to break the 136.000 mark was successful.
Now we have 2 possible scenarios:
1. A small correction towards the 1H critical area near 135.960 which also lies within the daily critical zone. Afterwards a touch with the upper trendline of the daily timeframe can be expected.
2. The more profitable way of the price playing out is if we see a bigger correction towards the 1H critical zone near 135.000. It is not only a psychological point, but it also aligns with the 0.618 Fibonacci retracement . After that price will move once again towards the upper trendline .
If any of the scenarios takes place a small correction or a move towards 135.000 must take happen after the price meets our upper trendline .
Happy Trading!