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On February 5th, I wrote about a GBPJPY bullish breakout.
The pair broke out from a multi-year trend line that hinted at a move toward 148.00, followed by the 150.00 region.
Here’s a broader view of the GBPJPY breakout:
As you can see, GBPJPY was breaking out from a trend line that extends from mid-2016.
If we use the larger wedge pattern that has developed since 2007, we get a possible (longer-term) target between 150.00 and 155.00.
And GBPJPY is well on its way.
Since the breakout in early February, the pair is up over 300 pips.
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However, it’s also getting a bit overextended, particularly after today’s 120 pip gain.
If we do see a pullback after Monday’s rally, I will keep a close eye on 146.00.
It was a key pivot a couple of years ago, and it also served as a stopping point during Monday’s move.
While I do think GBPJPY could reach the area between 150.00 and 155.00 in the coming weeks, don’t forget about 148.00.
I mentioned this area on February 5th.
It’s been a critical area for years, so I do expect sellers to defend 148.00 if tested.