GBPJPY Long Scalps Favored into April Opening Range- 172.60 in Focus

Talking Points

• GBPJPY topside bias in play heading into April
• Monthly/Weekly opening ranges taking shape below near-term resistance
• Longs scalps favored above 171

GBPJPY Daily Chart

Chart Created Using FXCM Marketscope 2.0

Technical Outlook

• GBPJPY holding within confines of Andrew’s pitchfork dating June 2012- constructive
• April Opening Range to take shape just below key resistance 172.32/60
• Breach targets resistance objectives at 173.57/75 & 174.82
• Longer-term objectives eyed at 177.45/70
• Support at 171 & 169.70
• Broader outlook constructive above 167.57-168.11
• Daily RSI rebound off 40 and subsequent 60 / trigger breach– bullish
• Limited Event Risk from UK & Japan – USNon-Farm Payrolls Friday

GBPJPY Scalp Chart

Notes: GBPJPY is opening up the April range just below resistance and while our broader outlook remains weighted to the topside, near-term long exposure is at risk below this threshold. We’ll look for a break of the weekly opening range (defined by 170.97 - 172.32) to validate our directional bias while noting a general tendency to buy dips while within the ascending channel formation dating back to the March 26th low.

A break below 171.34 puts us neutral with only a move sub- 170.97 suggesting that a more significant correction may be in the works. It’s important to note that on a broader scale, the pair has been in consolidation, making a series of lower highs and higher lowers since the January open with a topside breach ultimately favored.

Bottom line: we’ll look for the weekly / monthly opening ranges to offer further conviction on our directional bias with our immediate focus on the long-side while above 171.34/46. The intra-day RSI signature looks constructive and although there has been ongoing divergence in price, a topside resistance trigger is in play. A break sub-170.96 with an accompanied move sub-40 in RSI shifts our near-term focus to the downside with our broader outlook weighted to the topside while above 167.57-168.12. Follow the progress of this trade setup and more throughout the trading week with DailyFX on Demand.

* It’s extremely important to give added consideration regarding the timing of intra-day scalps with the opening ranges on a session & hourly basis offering further clarity on intra-day biases.

Key Threshold Grid

*ORH: Opening Range High

*ORL: Opening Range Low

Other Setups in Play:

• Scalps Favor Selling Rallies in EURAUD Post Head and Shoulders Break
• GBPUSD Setup Targets Key Support- Scalp Bias Constructive Above 1.6469
• AUDUSD Testing Key Resistance at 9150- Weekly Open in Focus
• Key Reversals on USDOLLAR, Gold Post FOMC- March Range at Risk

---Written by Michael Boutros, Currency Strategist with DailyFX

For updates on this scalp and more setups follow him on Twitter @MBForex

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