2025/02/21 GBP/JPY Strategy
On the daily chart, yesterday’s price action dropped to the red line at 189.5, the key level I had drawn in my weekly strategy.
On the 15-minute chart (M15), price dipped below the red line once, formed a double bottom and came back up, and it is now forming a range like the one in the red box.
The key point today is whether price breaks out of this range in either direction or just drifts around inside it.
Scenario A is buying the dip after price breaks above the range and the bias makes a bullish shift, and this looks like the most likely one.
In that case, I’m looking at a target around 190.3.
Scenario B is a short scenario for when price fails to clear the range high and drops back down again. Since this plays out within the range, the target is around the range low at 188.9.
Then there’s Scenario C, which targets a retracement after a break below the range. If price breaks lower, I’d like to aim for around 188.3.
Review
Just as I read it in the morning, price rose for a while.
It went beyond 190.3, which I had seen as the near-term target, and reached the next line up.
The places where you could have entered are the 3 spots shown in the chart above.
○1
Price didn’t break the red line I saw as the range high, but there was a short-term S/R flip, and on the 5-minute timeframe it was forming a range breakout, so this is a spot where you could go long.
Taking profit where the move stalls a bit around the blue line is fine.
○2
This is buying the dip after the break above the blue line.
Here too it’s acting as short-term S/R, and on the 5-minute timeframe it was turning up (making higher lows) and felt solid, so you can consider a long. However, the area in the previous point is the rally high on the 4-hour timeframe, so this is a trade where you need to keep in mind a scenario where price drops sharply without making a new high.
○3
This was the best entry point of the day.
Since the shape of the chart changed, it’s a part I couldn’t map out in the morning strategy, but it’s selling the rally after a double top formed → an S/R flip at the closely watched blue line → turning down (making lower highs).
Taking it down to the recent low would have been about 130 pips, and if it extended one more leg, 200 pips was possible from this entry point.
This article reflects the author's personal view of the market. It does not recommend any specific trade; all investment decisions are your own responsibility.
