Whattup, forex friends!
We’re all about the pound’s trends today because EUR/GBP is hitting a channel resistance while GBP/JPY is trading near Fib retracement levels.
Check them out, yo!
GBP/JPY: Daily
Guppy has been on an uptrend since mid-2020 but now it’s consolidating at the 153.00 major psychological level.
As you can see, 153.00 lines up with not only the daily chart’s trend line support but also the 61.8% Fibonacci pullback of October’s upswing. Oh, and check out the 100 and 200 SMAs hanging out just under the current levels!
The cherry on top of the sweet setup is a bullish divergence on the chart.
Pound bulls and trend warriors can buy at current prices or wait for the first signs of bullish momentum to take advantage of the pullback.
If it’s NOT a pullback, though, or if GBP/JPY has enough bearish momentum to break below the months-long trend line support, then y’all also gotta be ready to trade a downside breakout.
149.25 looks good as an initial target for the bears but you can also aim for 143.25 if there’s enough momentum.
EUR/GBP: Daily
I know you like trading them European currencies so I bet you’d like to know that EUR/GBP is having trouble making new highs above the .8550 mark. That’s around the 200 SMA and the channel resistance on the daily time frame!
Euro bears can short at current levels and aim for October’s lows for the best reward-to-risk ratio the long-term downtrend can offer these days.
Of course, if you’d rather buy the euro or short the pound, then you can also bet on EUR/GBP extending its October upswing.
Just make sure that EUR/GBP breaks above the channel first! If you don’t want to get burned trading a countertrend trade, then you’ll want to wait until the euro breaks its downtrend first before you bet on a long-term reversal.
