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With trends going strong these days, I’m hoping to catch this simple bearish retracement setup on Guppy ahead of the U.K. jobs release.

Currency Snapshot:

Major Forex Pairs Price Performance from MarketMilk
Major Forex Pairs Price Performance from MarketMilk

Fresh Market Headlines & Economic Data:

Upcoming Potential Catalysts on the Economic Calendar:

  • Swiss SECO revised economic forecasts at 6:45 am GMT
  • U.K. claimant count change, jobless rate, and average earnings index at 9:30 am GMT
  • German and euro zone ZEW economic sentiment figures at 10:00 am GMT
  • EU Economic Summit ongoing

What to Watch: GBP/JPY

GBP/JPY 1-hour Forex Chart
GBP/JPY 1-hour Forex Chart

Guppy looks prime for a pullback to the descending channel top, which lines up with the 61.8% Fibonacci retracement level.

A shallow correction could already find resistance at the 50% level, which coincides with an area of interest or former support at the 131.60 area. Heck, price already seems to be hitting a roadblock at the 38.2% Fib as sellers might be eager to return!

The U.K. is set to print its jobs data in the upcoming London session, and downbeat results could cast more doubts that the economy could weather the market rout.

If you think the selloff could carry on soon, scaling in at the Fibs with a stop that’s wider than the average daily GBP/JPY volatility could work.

GBP/JPY Volatility from MarketMilk
GBP/JPY Volatility from MarketMilk