GBPJPY was following a strong bullish rally which started in Feburary 2020 under daily time frame and completed its 5th impulsive wave at 155.70. Pound, even though struggling against the increased numbers  in Covid-19 infectants and deaths, still managed to maintain itself with 75% gains from previous year. 

GBPUSD  holds a bearish “outside day” to leave the cable at risk of a fall back to 1.3734, then more important support at 1.3669/48, analysts at Credit Suisse report.

Since the Brexit negotiations were "so called" tackled, tensions over fishing rights in UK waters remains unresolved and Uncertainties over the future of the Brexit deal has been creating a lot of volatility lately in the cables against the other currencies. New covid mutation is ‘out of control’ in the UK and BoE preparing for negative interest rates is a clear msg by BoE to provide dovish, specter of negative rates.

Coming back to GBPJPY, under the weekly time frame it still seems to have room for further selling momentum to complete its correction which under my observation is around 61.8% and 50% fibb levels. A strong bullish retracement or continuation of the bullish structure can be expected if an impuslive wave is witnessed from levels between 150.20 and 149.00 which acts as major price actions.

The current market scenario tends to produce a temporary upwards thrust to fill the order book with executed orders on the buying side which will pull the pair towards 152.70 and 153.25 which should be considered as continuation of bearish pattern if a bearish impulsive wave was observed from the aforementioned levels. On our behalfs we are taking the current move of GBPJPY under daily and four hourly time frame as a temporary consolidation with a range bound like structure for mostly after a correction of "a,b,c" waves, the market enters into extended WXYZ structure, so we will update traders with better positions once the above mentioned levels and circumstances are met. 

Has GBPJPY completed its correction ?

Jul 09 2021

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