Correction was shallow. Price bounced off a little below 23.8% retracement. For several hours, it compressed to give way to clear signals of buy.
From here, we can expect bulls to try to break yesterday’s high of 161.85. If bulls are successful, we’ll see 162.70 to 163.30 if not today, then tomorrow.
From 163.30, we can expect the bears to come in.
GBPJPY, 23-03-28, London Session by traderh on TradingView.com
Bulls overcame 161.40 for several hours during US Session and made price close near highs. They easily took out the day 2 high as well. We could be seeing a short-term turn to the upside. However, resistance remain at 163.30. This could probably the most that the bulls can carry through.
Corrective price action has begun in today’s Asian Session.
Bullish traders may way for key levels in the fib. 161.00, 160.50, 160.00 and 159.60. Best to wait for compression before getting into it. If bulls take out 161.85, we should see 162.70 to 163.30 before nosediving anew.
GBPJPY, 2023-03-08, Asian Session by traderh on TradingView.com
Bulls have managed to take out Friday’s high of 160.80. The next resistance to take out would be psychological 161.00 and 161.40. Taking out 161.40 would invalidate a possible bearish trend.
We may see a short-term bullish trend upwards if 161.40 is taken out.
Extreme resistance lies at 163.30.
GBPJPY, 23-03-27, London Session by traderh on TradingView.com
Bulls protected extreme support at 158.25 last Friday. They came in strong to push back up to 160.00.
In the dailies, we see the lower high, lower low formation so we continue to be bearish on GBPJPY. The only question now is at which retracement level will the bears come again?
By plotting the fibonacci retracement of the whole bearish leg of Wednesday to Friday, we see 160.80 as the 50% bargain level and also the high of the latest price action. Bears should come in strong here. Their last level to make a sold trend continue is at 161.40.
If bears attack at 160.80 or any level lower than that, it will increase the probability of a bearish trend beyond 158.20.
GBPJPY, 2023-03-27, Asian Session by traderh on TradingView.com
Bears has suppressed any effort of the bulls to push price back up. That retracement to a shallow 38.2% yesterday was an indication of how strong the bears are.
GBPJPY, 23-03-24, London Session by traderh on TradingView.com
I tried to position ahead but lost toward the 4pm (GMT+8) close.
I’m currently holding a single short position that I entered at breakout. Price will most likely hit extreme support at 159 to 158. Would bulls be there to keep it from free-falling?
Bulls never came back even with central bankers adding more points to interest rate hikes. It is as if rate hiking has become a disappointment rather than a reason to greed.
This morning, the Asian Session digested the negativity and pressed price down surpassing 160.00. This has somehow reinforced the bearishness in the dailies that signaled a lower high lower low pattern.
However, even when main bias is to short, we always have to consider the placement of the short. Shorting at current 160.30 posts a higher degree of risk than shorting at 160.80 or 161.50. There is plenty of time to wait for a good bargain to short.
On the other hand, the immediate bias is to go long between 159.75 to 160.30 with an expectation of correction of the immediate bearish leg.
In any case, it’s always best to wait for a nice 3-hour compression at the very least before attempting to trade.
GBPJPY, 2023-03-24, Asian Session by traderh on TradingView.com