How to trade Forex Cross Pairs
In today’s article, I thought we could benefit from the studies we have done before in this very same blog page. We may have a beautiful opportunity taking shape on a cross pair and Platinum Traders will have that under their radar.
Let’s talk about how to trade the GBP/JPY.
I have mentioned that we could use some information we have provided before here. As you all should know, the GBP/JPY will be a currency involving the Great British Pound and the Japanese Yen.
As this is a cross pair, Platinum Forex Traders will also be able to take advantage of our Banker Trade Strategy. If you would like to learn more about this Forex Trading Strategy click here.
How to trade the GBP/JPY – Fundamentals
Now back to the subject, for Sterling, we just need to refer to our blog article Trading the Great British Pound and will have an idea of what to expect from that particular currency.
For the Japanese Yen, which is the other part on this cross pair, we all know, or at least should know, the important role of that currency. The Yen, as it is often referred to in the trading world, is a safe haven currency. That means traders and investors have a belief that this particular currency is stable enough to keep its value if compared to other currencies in times of uncertainty, inflation and any other forms of crisis.
The North Korea impact
Talking about uncertain times, I guess that we could easily classify “right now” as this kind of environment. I am sure you have heard countless times in the news about the volatility between the United States and North Korea. There is a possible conflict on the horizon between these two countries. As sad as it may be, there are two ways you can look at this. One you can do nothing and lament about the world, its wars and current situation or two, you can actually use that knowledge to make some extra profits.
Since North Korea has shown no intention to hear anyone insisting in its continued nuclear program and with Trump in power in the US, that conflict is looming. Plus the US Dollar which is so weak and with no hopes for any strength to pick up in the near future, Selling Sterling and Buying the Japanese Yen would be a good proposal.
That is exactly what Platinum Traders plan to do if and when this trade comes into play.
How to trade GBP/JPY – Technical Analysis:
From the chart on the left we can see GBP/JPY has rejected the top of the Ascending Triangle and has now breached the ascending trending line. All Platinum traders know exactly what to do on a breakout like that. BPC on it!! We will favour short positions on a pull back to 144.20 as another retest of the Trending Line. As for the fundamentals, the Japanese Yen is very Bullish due to its safe haven status and the Pound is entering a possible reversal Head & Shoulders against the US Dollar.
We believe that both the pull backs on the Yen and Cable will be the perfect match with this level and a perfect trade could potentially come into play.
How to trade the GBP/JPY:
A) Short the GBP/JPY @ 144.20 or the nearest zone with 100 pips stop loss and a target of 135.85
If you have any questions on the trade set ups, please contact the Platinum team
KEY TECHNICAL LEVELS ON GBP/JPY:
- 114.20 – Long Term Selling level
- 138.85 – Short Term Buying Level
- 135.85- Long Term Buying Level
- 132.90-Short Term Buying Level – Platinum’s Premium Fib level
- 129.25-Short Term Buying Level
- 123.25 – Long Term Buying Level
How to become a profitable Trader.
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Hopefully, you have enjoyed today’s article as much as I have enjoyed writing it and have gained great knowledge about trading and how to trade.
See you soon!
The Platinum Formula:
Perfect Fundamentals + Perfect Technical Analysis + Perfect Logic + Perfect Risk Management = Perfect Trade
THE PLATINUM WAY
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Hopefully, you have enjoyed today’s article. Thanks for reading!
Have a fantastic day!
Live from the Platinum Trading Floor.