I understand many Yen pairs started to show some bullish movement, front-running the expected further QE from BOJ.
I would like to write Long setup for GBPJPY. However, from pure technical analysis, I see the opposite trade. (thus SELL)
Here is why.
This is the Daily chart, and the price seems to have rejected at MM3 (184.78), which is also Role-Reversal resistance. Stochastic is at 75%, though not yet to turn down.
Most likely, USDJPY will be flat for a while. But how about GBPUSD?
Here is GBPUSD H4 chart. I see a Bearish Divergence on Stochastic.
Thus shorting GBPJPY would also make sense. (You could simply trade GBPUSD if you prefer!)
Currently GBPJPY is in the up cycle on Hourly chart (Below), riding 55EMA which may indicate the price will make Lower High or Double Top.
Therefore I would like to sell this pair from the next down cycle (as long as the price doesn’t make higher high). If it doesn’t work out, I will try the next down cycle as well.
Stop should be 185.00. The conservative target should be 183.30 (MPP), and the aggressive (Swing) target should be 181.00 ish (Prev Low on Daily).
The market is thin today. So this setup may be in effect even tomorrow.
But… I just hope this analysis helps you even a bit.
YJ Baik – Forex.Today @ Tokyo