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GBPJPY Opening Range Setup- Long Scalps Vulnerable Sub 195.50

GBPJPY Opening Range Setup- Long Scalps Vulnerable Sub 195.50

Michael Boutros, Strategist

Talking Points

GBPJPY Daily

Chart Created Using FXCM Marketscope 2.0

Technical Outlook

  • GBPJPY weekly opening range in focus after tagging MLP resistance last week
  • Rally is vulnerable near-term below this week’s high ~195.50
  • Interim support at highlighted region into the R1 backed by 192.50
  • Broader bias remains constructive above the February ML / 189.70
  • Breach of the highs targets the upper MLP / 196.46 (key resistance)
  • Daily RSI in overbought territory- constructive
  • Daily close sub-70 would validate near-term correction lower
  • Event Risk Ahead: BoJ Minutes tonight & Japanese Jobless Rate & CPI on Thursday

GBPJPY 30min

Notes: GBPJPY is has set a tight weekly opening range after rebounding off key resistance last week at the upper median-line parallel dating back to the 2015 lows. Intraday momentum has continued to hold-60 resistance and the pair remains vulnerable for a setback while within the proposed ML formation off last week’s high. Interim support rests at 194.59/64 with a break below targeting confluence support around 194. Subsequent support objectives are seen lower at 193.16/20 & 192.50.

We’d be inevitably looking to buy this pullback with a breach of the highs targeting last week’s high at 195.81 backed by more significant resistance up at 196.37. Bottom line: look for a break of this initial weekly OR to offer further guidance on the near-term directional bias with a break of the lows shifting the immediate focus lower. Event risk is limited on the pair this week with tomorrow’s Japanese CPI print highlighting the docket. A quarter of the daily average true range yields profit targets of 33-36 pips per scalp.

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Relevant Data Releases

Other Setups in Play:

---Written by Michael Boutros, Currency Strategist with DailyFX

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