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Trading a Potentially Significant GBPJPY Breakdown

Trading a Potentially Significant GBPJPY Breakdown

Jamie Saettele, CMT, Sr. Technical Strategist

GBPJPY traded into big resistance this week from highs throughout April, May and June. The 5/23 close at 154.03 marked the exact high for the latest advance (7/24 high was 154.03).

GBPJPY

Daily

Trading_a_Potentially_Significant_GBPJPY_Breakdown__body_gbpjpy.png, Trading a Potentially Significant GBPJPY Breakdown

Chart Prepared by Jamie Saettele, CMT using Marketscope 2.0

Are you new to FX or curious about your trading IQ?

FOREXAnalysis: GBPJPY traded into big resistance this week from highs throughout April, May and June. Most don’t pay attention to close levels but closes of important market days (or weeks, months, hours, etc.) often serve as useful pivots…sometimes with an uncanny degree of accuracy. The 5/23 close at 154.03 marked the exact high for the latest advance (7/24 high was 154.03).

At one degree higher (see next chart), the GBPJPY high in May was registered 3 pips above the breakdown week from August 2009 (weekly close in August 2009 at 156.76 and May 2013 high at 156.80).

FOREX Trading Strategy: I’ve been focusing on the GBPJPY trade in the Daily Technicals Yen section since Wednesday but for those not yet involved in the trade, strength above 152.00 would now present an opportunity to participate on the short side. 152.15 and 152.67 in particular form a zone of resistance (see 2 charts down). Shorts are valid below 154.10. Support to exit half of the trade is 149.90.

GBPJPY

Weekly

Trading_a_Potentially_Significant_GBPJPY_Breakdown__body_gbpjpy_1.png, Trading a Potentially Significant GBPJPY Breakdown

Chart Prepared by Jamie Saettele, CMT using Marketscope 2.0

Are you new to FX or curious about your trading IQ?

GBPJPY

4Hour

Trading_a_Potentially_Significant_GBPJPY_Breakdown__body_gbpjpy_2.png, Trading a Potentially Significant GBPJPY Breakdown

Chart Prepared by Jamie Saettele, CMT using Marketscope 2.0

Are you new to FX or curious about your trading IQ?

--- Written by Jamie Saettele, CMT, Senior Technical Strategist for DailyFX.com

To contact Jamie e-mail jsaettele@dailyfx.com. Follow me on Twitter for real time updates @JamieSaettele

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Jamie is the author of Sentiment in the Forex Market.

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

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