GBP/JPY Technical Analysis – H4

Price failed to bounce from the support zone at 217.70–217.90 yesterday. As a result, the downward correction deepened almost to 217.00, with the risk of a further slide toward 216.500. The latter support can be viewed as critically important for the bulls, since a break below it would complete a large Head-and-Shoulders reversal pattern. Elevated volatility should also be expected today on the back of the FOMC rate decision.

Key Levels:

□ 1. 217.70–217.90 – broken support zone

□ 2. 217.000 – near-term downside target

□ 3. 216.500 – critical support / potential bounce area

□ 4. 216.000 – alternative breakdown level

Primary Scenario:

Decline toward 217.000 and possibly 216.500. An active rebound is possible from either of these levels.

Alternative Scenario:

A drop below 216.000.

Analyst Commentary:

There are no reliable levels at present. It makes sense to stay out of the market today (or at least significantly reduce risk).