- Bearish Scenario: Sell below 196.00 with TP1:195.11 and only after its breakout, TP2:194.38 and TP3: 194.80 with S.L. above 196.43 or at least 1% of account capital.
Bullish Scenario: Buy above 197.41 with TP: 199:00, TP2: 199.50 with S.L. below 197.00 or at least 1% of account capital. Apply trailing stop. Fundamental Analysis
Fundamental Analisis
The GBPJPY pair faces challenges following mixed UK employment data. The ILO Unemployment Rate rose to 4.3% in March, aligning with expectations, while jobless claims increased by 8.9K in April. Additionally, UK Employment Change stood at -177K, signalling deterioration compared to the previous reading of -156K. The Bank of England suggests potential rate cuts, citing the need for confidence amid economic uncertainties.
Simultaneously, the Bank of Japan (BoJ) appears inclined to delay rate hikes until September, awaiting further data on monthly wages. Collaborative efforts between the government and BoJ aim to ensure policy alignment, especially concerning exchange rate dynamics. Japan's Finance Minister emphasised proactive monitoring of the yen's movements. Technical
Analysis H4
The pair remains within an extensive multi-year bullish trend that peaked at 200.55 in April, a 15-year high, followed by a significant retracement, possibly due to two potential interventions by the BoJ.
After the bearish correction, the price attempts to ascend again towards the supply zone between 196.41 and 197.41, observing the uncovered Point of Control (POC) of two weeks at 196.96 and the Asian one at 196.41, indicating potential bearish defence until this zone is breached, potentially causing a new downturn.
Sales will be considered after a decisive breakthrough below 195.87 with intraday selling targets at yesterday's uncovered POC around 195.11, and only after its breakout, extending sales towards subsequent zones such as 194.38 and 193.79 in extension.
Each uncovered POC represents demand zones that trigger buying if not decisively breached. The buying target will be broader the further away the previous supply zone is.
Only a breakthrough above the upper limit of the supply zone at 197.41 will indicate bullish dominance with a possible upward extension towards 199.00.
*Always wait for the formation and confirmation of an Exhaustion/Reversal Pattern (PAR) on M5 before entering any operation in the indicated key zones. We explain the patterns in this telegram post: [link].
*Uncovered POC: POC = Point of Control: It is the level or zone where the highest volume concentration occurred. If there was previously a downward movement from it, it is considered a selling zone and forms a resistance zone. Conversely, if there was previously an upward impulse, it is considered a buying zone, usually located at lows, thus forming support zones.
Risk Warning
This analysis does not constitute investment advice or an offer to engage in financial transactions. Although all investments involve risks, trading forex and other leveraged assets can entail significant losses. A comprehensive understanding of the risks is recommended before investing.
