Trading opportunities for currency pair: Buyers were unable to break the TR2 trend line. Judging by the AO and AC (Bill Williams) indicators, there is a consensus that the rate will form a triangular pattern, coming out only in March. In such a case, the rate should fall to 132.27 JPY by 03/04/17. If the first half of this prognosis comes true, then from 132.27 JPY, the GBP rate should restore to around 144.6 JPY.
The weekly bar from the 16th to the 20th of January 2017 is showing some bullish features. The rate could easily return to the 144.65 region. The possibility of a slide will be minimal should the candle close higher than 145.70.
Background:
We last published an idea regarding the GBP/JPY pair on the 30th of May last year. At the time of publication, the British pound was worth 161.96 JPY. According to trends, a strengthening up to 163.85 and then 165.09 was expected. The first target was achieved the very next day, on the 31st of May, but buyers failed to reach the second. From a level 163.89 JPY, the British pound began a phase of depreciation.
Current situation:
The GBP/JPY pair began a bearish trend in June 2015 at a maximum of 195.88 JPY. Since October 2016, the pair has been in a correctional phase. In 10 weeks, the pound has risen against the yen from 124.79 JPY to 148.45 JPY (a rise of 2,366 points). At this level, buyers met with resistance from sellers. Buyer activity was restricted to the minimum and maximum of 2013. The 38.3% Fibonacci level is at 151.94 JPY.
The TR1 trend line (H195.28 H188.81) is high above the current rate, so let’s look at the other trend line (TR2), which is drawn through the highs 163.90 JPY and 148.46 JPY.
Last week, buyers were unable to break through it. The GBP/JPY rate fell to 140.46 (down 390 points). Brexit has inhibited buyer activity.
The weekly bar from the 16th to the 20th of January has a bullish look to it. The rate could easily return to around 144.65 JPY. Judging by the AO and AC (Bill Williams) indicators, there is a consensus that the rate will form a triangular pattern, coming out only in March. In this case, the rate will fall to 132.27 JPY by 03/04/17. If this part of the forecast comes true, the pound is expected to restore to 144.60 JPY.
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