2025/07/22 GBP/JPY Trade Strategy

Today's GBP/JPY call: Sell.

Conditions are still tricky.
Price is near the 4-hour range low while the daily chart is rising, which adds buying pressure, but at the day-trading level it’s a sell for now.

Scenario A
I’m seeing the current range as roughly 198.5–199.
The 1-hour is bearish, but it’s also showing signs of downside stalling.
If price makes higher lows from here and breaks out of the range, that’s a bullish shift.
I’ll look to buy the pullback after the upside break.
Since the daily chart’s momentum is fading, I’m assuming movement within the range, so the target is around 199.5

Scenario B
I see the 1-hour as a sell, but the 15-minute has turned bullish in the short term.
If I’m selling, I’d like to wait for a bit more of a setup.
Ideally, I want to let price come up close to the Scenario A line before selling.
Target is 198.3

Scenario C
A sell after a break below.
Around 198.3 acts as support, so selling after a break below the pink line around 198.55 leaves no room to run.
Entry depends on how the chart shapes up.
I think shorting after a break below 198.3 is fine too. (Strategy to be revised)

Review

It was Scenario C.

Price dropped sharply, but at the start of the decline (blue circle) the 15-minute chart (M15) hadn’t made a bearish shift yet, so it’s hard to get in there.
If you were holding a long, that’s the place to close out, but it’s not a place to open a short.
That said, on the 4-hour chart (H4) it’s an obvious candidate for selling the rally, so if you trade one timeframe higher, it’s a valid entry.

After that, the short comes at the red circle, where price breaks below the pink line and it turns into support/resistance (S/R).
This one is a bit on the difficult side, but given the momentum of the recent drop and the fact that it lined up perfectly with the entry point I had laid out in the scenario, it’s fine to go for it.

Take profit is where price stalled at the yellow line and formed a higher-low double bottom. 92 pips