2025/07/16 GBP/JPY Trade Strategy

Today's GBP/JPY call: Buy.

The chart jumped a bit on the UK CPI release, but the structure looks like it’s about time to buy.
However, this isn’t a spot that would count as a pullback on the 1-hour chart, so short-term trade management is needed.

Scenario A
If price breaks to the upside, the textbook play is buying the dip, but there’s a line around 199.8 that should act as resistance.
Keep watching after entry, and exit immediately if you judge that price can’t get past the line.
You can always look for another pullback once it clears the line.
Target: around 199.8.

Scenario B
Go long from around the short-term pullback low.
This pattern is the safest one.
On the current chart, that timing is coming up soon.
Target: 199.8

Scenario C
If price breaks to the downside, sell the rally.
That said, this is also a spot to take a short-term move.
Target: the green line at 199.
I don’t think a real decline will start until that line breaks.

Review

It played out as Scenario C.

When I wrote the scenario, the setup was “almost time to buy,” but price turned down before the conditions lined up, so I switched to wait and see.
The opportunity was a short from the red circle, on the retracement after price broke the 15-minute pullback low.

Price barely bounced at the green target line and kept falling, so I held the position.
I took profit when price bounced off the blue line around 198.3, which is 4-hour support. 93 pips

The move seems to have been driven by fundamentals, but in the end it followed the technicals.