GBP/JPY plan for the upcoming week Weekly Overview
Market Structure & Key Levels:
The chart displays a potential Bullish Order Block formation with a strong focus on the 196.70 - 197.00 level. This level acts as a primary area of interest due to significant market reactions and serves as the Point of Control (POC) for the upcoming week.
A Break of Structure (BOS) has occurred, indicating a potential shift from a bearish to a bullish trend. This BOS acts as confirmation of a reversal if we see sustained buying pressure above these levels.
Harmonic Patterns:
The harmonic pattern highlighted around the previous highs signals a potential exhaustion point. This pattern confirms that sellers may encounter resistance if price reaches levels above 199.00.
Weekly Wave Analysis:
The Elliott Wave count suggests a completion of Wave 3 with the potential for a Wave 4 retracement towards the 197.00 - 197.50 range. If this retracement holds, we may see a bullish continuation to complete Wave 5.
Projected Price Movements:
Monday (M): A probable continuation of the retracement from previous highs, aiming for a correction towards the support zone around 197.00.
Tuesday (T): Expecting consolidation and a potential test of the 0.236 Fibonacci level around 196.70. Any price action below this level may invalidate the bullish scenario.
Wednesday (W): Possible bounce and start of an upward move if the correction holds, targeting 198.00.
Thursday (T): Bullish momentum could push GBP/JPY towards 198.60 - 199.00 if previous days’ levels hold. This level marks a critical resistance.
Friday (F): Anticipated end of the upward move and potential profit-taking. Resistance around 199.40 could act as the week’s high if buyers lose strength.
Risk Management:
A good stop-loss strategy would involve setting stops below 196.70 for buy positions on lower timeframes.
Monitoring volume profiles and price rejections around these key levels will be crucial for managing entries and exits effectively.
Summary
The week’s outlook for GBP/JPY involves a probable retracement early in the week, followed by a bullish wave continuation toward 198.60 - 199.40 by week’s end, provided key support levels hold. Keep an eye on major economic events and fundamentals that could impact JPY strength, as they could influence GBP/JPY movements in the anticipated ranges.
