2025/10/02 GBP/JPY Trade Strategy

Today's GBP/JPY call: Sell.

Every timeframe from the higher timeframes down is a sell.
The downward momentum has weakened, so the question is whether this is a pause before another leg down, or whether we get a retracement higher first.

Scenario A
I see the range high around Line A, so if price breaks above it, I’ll switch to a bullish bias.
However, the overall trend is down and there are several resistance zones on the 1-hour chart, so even if I enter, I absolutely can’t just leave the trade unattended.
Target is 198.8, ideally I’d like to take it to 199.

Scenario B
If price can’t break above the current range, I’ll sell from around the range high.
If it drops another leg from here, I think the final destination is roughly around 197.6.
If it stalls at the range low, I’ll exit.

Scenario C
Selling the rally after a break below.
Target is the same as Scenario B.
Depending on how the chart shapes up, the risk-reward could be poor, so be careful with the entry decision.

Review

It was Scenario B.

This was a short at ○1 after price turned down (making lower highs) at the range high in the morning.
However, price whipsawed up and down after that, so some people may have taken a breakeven exit or a stop loss.
Basically, when entering at ○1, I set the stop-loss level slightly above the next pink line up.
This is because, on the 1-hour chart (H1) as well, the structure allows for a pullback to around the pink line before a drop.
If you had set your stop-loss level just above Line A, you would have been stopped out.
I think it was a somewhat tricky move.
Take profit was at the small turn up (higher low) after the target of 197.6 was reached. 68pips

If you got stopped out at ○1, you could enter at ○2 under Scenario C.
However, the risk-reward isn’t great.
Entering at ○2 would have given about 25pips.

After that, you could aim for it again from ○3.
This is a short off the blue line.