Higher Timeframe Context

On the weekly timeframe, GBP/JPY continues to maintain its bullish structure, with buyers still holding control of the broader trend. However, zooming into the daily timeframe, price has already reacted from a well-defined supply zone, showing signs that upside momentum may be stalling. This confluence creates a scenario where short-term corrective moves can develop, even within a larger bullish trend.

H1 & Intraday Development

On the H1 chart, price tapped into supply and is showing rejection wicks, suggesting that sellers are beginning to enter the market. The presence of this supply, combined with weakening bullish momentum near 199.70, increases the probability of a short-term pullback.

The rising trendline support (from August 21) has been respected so far, but a decisive break below it could act as the trigger for bearish continuation.

Trade Idea – Bearish Scenario

If price breaks below the ascending trendline, it would confirm loss of short-term bullish structure and open the way for deeper retracement. The logical downside target becomes the daily Fair Value Gap (FVG), aligning with the 197.38 zone.

Entry Confirmation: Break and close below trendline on H1/M15.

Target 1: 198.40 (intermediate liquidity zone).

Target 2: 197.38 (daily FVG completion).

Invalidation: A sustained move and close above 199.70 (supply invalidation).

Outlook Summary

Weekly Bias: Bullish (macro still intact).

Daily Bias: Supply rejection, corrective pullback favored.

Intraday Bias: Bearish below trendline, with liquidity targets down to 197.38.

Traders can look to exploit short-term sell opportunities within a bullish weekly market by targeting inefficiencies and liquidity pockets.

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GBP/JPY Forecast – Supply Pressure Could Trigger Pullback