GBPJPY has been bearish as far as the H4 chart is concerned. The pair has produced some good-looking bearish candles. This shows that the sellers are eager to sell the pair. As things stand with GBPJPY, the price has enough room to go towards the South.
As we can see that, the pair produced a Double top at 141.650. Then, those 5 consecutive H4 bearish candles drove the price down to 139.000. This level seems to act as the first level of support. If the price produces some corrective candles here and the level of 139.650 acts as a level of resistance, then sellers are going to wait for a breakout at 139.000 to go short again on GBPJPY.
Ideally, we should wait for an H4 Engulfing candle breaching the breakout level (139.000) with little spike. However, even if we get an hourly break after having an H4 reversal, that should be good enough to take short entry on the pair.
Here is the summary of the trade:
- Sell Stop Order: 139.000
- Stop Loss Level: 139.650
- Take Profit Target: 137.430
At the time of choosing a chart to take entry, we need to consider things such as
- Is there a Double top or Double bottom
- Is the price moving towards the direction with less confusion (little spikes).
- Does the chart look (price action) a clear one? It must not look messy.
If you have a look at other pairs that are related to GBP, almost all the pairs look good to offer entries. However, according to my calculation GBPJPY looks the best. It has produced a Double top; the price is moving towards the South with huge command and so far, the chart looks as clean as it can get.
These things we have to consider every time before choosing a pair to take entry.
Comment below if you have questions on this trade and please let us know if you made money if this trade signal. Good luck!
You can also take a look at our previous (and most likely profitable) Free Forex Trading Signals Here.
We hope that you enjoy our Free Forex Trading Signal today: GBPJPY Free Forex Trading Signals – 27th Feb 2017
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