Daily Pivots: (S1) 1.0630; (P) 1.0685 (R1) 1.0751; More.....

EUR/USD is still staying in consolidation inside range of 1.0588/0774. Intraday bias remains neutral for the moment. Choppy rise from 1.0339 is seen as a corrective move. Break of 1.0588 will indicate that such rise is completed and turn bias to the downside for retesting 1.0339 low. In case of extension, upside should be limited by 1.0872 resistance.

In the bigger picture, whole down trend from 1.6039 (2008 high) is in progress. Such down trend is expected to extend to 61.8% projection of 1.3993 to 1.0461 from 1.1298 at 0.9115. On the upside, break of 1.1298 resistance is needed to confirm medium term bottoming. Otherwise, outlook will stay bearish in case of rebound.

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GBP/USD Daily Outlook

Daily Pivots: (S1) 1.2435; (P) 1.2517; (R1) 1.2570; More...

At this point, GBP/USD is staying in range of 1.2414/2673 and intraday bias remains neutral. Rise from 1.1986 is seen as the third leg of the consolidation pattern from 1.1946. Break of 1.2414 minor support will argue that it's completed and turn bias to the downside for 1.1946 low. In case of another rise, we'd expect strong resistance at 1.2774 to limit upside and bring down trend resumption eventually.

In the bigger picture, fall from 1.7190 is seen as part of the down trend from 2.1161. There is no sign of medium term bottoming yet. Sustained trading below 61.8% projection of 2.1161 to 1.3503 from 1.7190 at 1.2457 will target 100% projection at 0.9532. Overall, break of 1.3444 resistance is needed to confirm medium term bottoming. Otherwise, outlook will remain bearish.

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USD/CHF Daily Outlook

Daily Pivots: (S1) 0.9907; (P) 0.9975; (R1) 1.0018; More.....

USD/CHF's fall from 1.0342 resumed after breaking 0.9958 temporary low. Intraday bias is back on the downside for deeper decline. Fall from 1.0342 is seen as the third leg of the pattern from 1.0327. Next target will be 61.8% retracement of 0.9443 to 1.0342 at 0.9786 and below. On the upside, however, break of 1.0043 will indicate short term bottoming and turn bias back to the upside.

In the bigger picture, rejection from 1.0327 resistance suggests that consolidation pattern from there is still in progress. Fall from 1.0342 is seen as the third leg and retest of 0.9443/9548 support zone could be seen. But we'd expect strong support from there to contain downside. At this point, we're still expecting the larger rally to resume later to 38.2% retracement of 1.8305 to 0.7065 at 1.1359.

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Daily Pivots: (S1) 114.50; (P) 114.94; (R1) 115.48; More...

USD/JPY's recovery was limited well below 115.61 minor resistance and reversed. Nonetheless, it's staying inside range of 112.51/115.61 and intraday bias remains neutral. The choppy decline from 118.65 is seen as a correction. Break of 115.61 resistance will suggest that the correction is finished and turn bias to the upside for 118.65. Break will resume whole rise from 98.97 and target 125.85 key resistance. On the downside, below 112.51 will extend such decline but downside should be contained by 38.2% retracement of 98.97 to 118.65 at 111.13 and bring rebound.

In the bigger picture, price actions from 125.85 high are seen as a corrective pattern. The impulsive structure of the rise from 98.97 suggests that the correction is completed and larger up trend is resuming. Decisive break of 125.85 will confirm and target 61.8% projection of 75.56 to 125.85 from 98.97 at 130.04 and then 135.20 long term resistance. Rejection from 125.85 and below will extend the consolidation with another falling leg before up trend resumption.

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• Risk aversion remains as Trump follows through on less market friendly promises;
• Yen higher on safe haven appeal, aided by higher BoJ growth forecasts;
• ECB President Draghi speaks in Frankfurt as eurozone CPI data signals higher prices.

European equity markets are positioned to open a little higher on Tuesday but traders appear to still be operating with caution as Donald Trump’s actions draw focus to the less market friendly aspects of his campaign that investors until now have overlooked.

Trump noted on Monday just how well the markets have performed since his election victory back in November but in that time, there has been a strong focus on his promises of fiscal stimulus, deregulation and tax cuts, all of which are supportive for markets. His actions over the last few days is another reminder that there were two sides to his campaign and Trump is just as adamant to follow through on those measures that will likely weigh on market sentiment in the coming months.

While we may be expecting a small bounce in European markets this morning, there appears to still be a sense of risk aversion carrying over from the US and Asian sessions, with the safe haven yen once again trading higher and Gold trading back above $1,200 having come off its recent highs over the last week.

The yen gains may have been slightly aided by the Bank of Japan’s more optimistic forecasts for growth following its meeting overnight. The central bank raised its outlook for growth and reiterated its belief that inflation will reach its 2% target around March 2019, while warning that risks to both are skewed to the downside. Governor Haruhiko Kuroda will likely be quizzed on one of those risks, Trump, when he appears for his press conference shortly.

We’ll also hear from ECB President Mario Draghi this morning when he appears in Frankfurt. Draghi’s appearance will come just ahead of the latest flash inflation figures for the eurozone which are likely to show overall prices rising by 1.5% but importantly core prices remaining unchanged at 0.9%. The pressure for the ECB to further reduce asset purchases has increased over the last month or so as German inflation has moved back to target and euro area inflation has increased but it’s important that the central bank doesn’t respond to temporary price movements and risk choking the recovery, particularly in the vulnerable periphery.

Yen gains broadly on risk aversion as the drama of US president Donald Trump's immigration ban continued. DJIA closed down -122.65 pts, or -0.61%, at 19971.13 overnight, below 20000 handle. S&P 500 lost -13.79 pts, or -0.6%, to close at 2280.90. NASDAQ dropped -47.07 pts, or -0.83%, to end at 5613.71. Nikkei follows and is trading down -1.7% at the time of writing. Treasury yields, on the other hand, was steady, with 10 year yield closed at 2.482, up 0.002. Dollar struggled to find a clear direction but weakened mildly, except versus Sterling. The dollar index hit as high as 101.02 yesterday but failed to sustain above 55 day EMA, and is now back at 100.35. In other markets, WTI crude oil stays in recent range and hovers around 52.50. Gold is trying to regain 1200 as consolidation extends.

BoJ left monetary policies unchanged as widely expected. Short term interest rates was held at -0.10%. The target of annual asset purchase was kept at JPY 80T under the yield curve control framework. The central bank warned in the quarterly forecast report that "risks to both economic activity and prices are skewed to the downside". While it noted that "The momentum for achieving our 2 percent inflation target is maintained", BoJ also sounded cautious and said it "lacks strength". BoJ expects inflation to hit 2% target by around March 2019, unchanged from November projections.

A bunch of data is also released from Japan today. Household spending dropped -0.3% mom in December, above expectation of -0.8% yoy. Industrial production rose 0.5% mom in December, above expectation of 0.3% mom. Unemployment rate was unchanged at 3.1% in December. Housing starts rose 3.9% yoy in December, below expectation of 7.4% yoy. Also from Asia Pacific, Australia NAB business confidence was unchanged at 6 in December.

Elsewhere, UK Gfk consumer confidence rose to -5 in January. French GDP rose 0.4% in Q4, in line with consensus. Germany will release retail sales and unemployment in European session. Eurozone will release unemployment rate, GDP and CPI flash. UK will release mortgage approvals and M4. Later in the day, Canada will release GDP, IPPI and RMPI. US will release employment cost index, S&P Case-Shiller house price, Chicago PMI and consumer confidence.

USD/JPY Daily Outlook

Daily Pivots: (S1) 114.50; (P) 114.94; (R1) 115.48; More...

USD/JPY's recovery was limited well below 115.61 minor resistance and reversed. Nonetheless, it's staying inside range of 112.51/115.61 and intraday bias remains neutral. The choppy decline from 118.65 is seen as a correction. Break of 115.61 resistance will suggest that the correction is finished and turn bias to the upside for 118.65. Break will resume whole rise from 98.97 and target 125.85 key resistance. On the downside, below 112.51 will extend such decline but downside should be contained by 38.2% retracement of 98.97 to 118.65 at 111.13 and bring rebound.

In the bigger picture, price actions from 125.85 high are seen as a corrective pattern. The impulsive structure of the rise from 98.97 suggests that the correction is completed and larger up trend is resuming. Decisive break of 125.85 will confirm and target 61.8% projection of 75.56 to 125.85 from 98.97 at 130.04 and then 135.20 long term resistance. Rejection from 125.85 and below will extend the consolidation with another falling leg before up trend resumption.

Economic Indicators Update

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BOJ on hold, raises GDP forecasts and inflation outlook

Asia Mid-Session Market Update: Political showdown over Trump's immigration curbs keeping markets on edge; BOJ on hold, raises GDP forecasts and inflation outlook

US Session Highlights

(US) DEC PCE DEFLATOR M/M: 0.2% V 0.2%E; Y/Y: 1.6% V 1.7%E

(US) DEC PERSONAL INCOME: 0.3% V 0.4%E; PERSONAL SPENDING: 0.5% V 0.5%E

(US) DEC PCE CORE M/M: 0.1% V 0.1%E; Y/Y: 1.7% V 1.7%E

(US) JAN DALLAS FED MANUFACTURING ACTIVITY: 22.1 V 15.0E; new orders, capex and employment rise m/m

(US) Atlanta Fed forecasts initial Q1 GDP growth at 2.3% v Friday's advanced government figure of 1.9%

VIX and Gold pop as investors look to offload risk

US markets on close: Dow -0.6%, S&P500 -0.6%, Nasdaq -0.8%

Best Sector in S&P500: Utilities

Worst Sector in S&P500: Basic Materials

Biggest gainers: AMG +4.8%, ADS +2.6%, WHR +2.4%, DG +2.4%, LM +2.3%

Biggest losers: VAR -12.5%, RIG -7.1%, CHK -6.7%, RRC -6.6%, DO -6.5%

At the close: VIX 11.9 (+1.3pts); Treasuries: 2-yr 1.20% (-1bps), 10-yr 2.48% (flat), 30-yr 3.08% (-1bps)

US movers afterhours

SANM: Reports Q1 $0.75 v $0.66e, R$1.72B v $1.68Be; Guides Q2 $0.67-0.72 v $0.64e, R$1.68-1.73B v $1.66Be; +10.9% afterhours

AEIS: Reports Q4 $1.06 v $0.81e, R$135.3M v $129Me- Guides Q1 $0.90-1.00 v $0.77e, R$141-151M v $125Me; Op margins 29-31%; +6.7% afterhours

WERN: Reports Q4 $0.30 v $0.26e, R$518.8M v $509Me; Guides initial FY17 net CAPEX expenditures "$225-275M" vs $430M y/y; +5.8% afterhours

IDTI: Reports Q3 $0.35 v $0.34e, R$176M v $178Me; Guides Q4 R$175M +/-$5M v $180Me; -4.4% afterhours

GBX: Files to sell $125M 2024 convertible unsecured notes; -4.6% afterhours

RMBS: Reports Q4 $0.16 v $0.16e, R$97.6M v $93.8Me; -5.4% afterhours

TEVA: Confirms District Court Decision in COPAXONE® 40 mg/mL Patent Trial; to appeal court decision; -8.9% afterhours

RRTS: Restates prior 2014-2016 period financial statements; -14.7% afterhours

Asia Key economic data:

(JP) BOJ LEAVES INTEREST RATE ON EXCESS RESERVES (IOER) UNCHANGED AT -0.10%, AS EXPECTED; RAISES OUTLOOK FOR PRICES

(JP) JAPAN DEC OVERALL HOUSEHOLD SPENDING Y/Y: -0.3% V -0.9%E

(JP) JAPAN DEC JOBLESS RATE: 3.1% V 3.1%E; Job to applicant: 1.43 v 1.42e

(JP) JAPAN DEC PRELIMINARY INDUSTRIAL PRODUCTION M/M: 0.5% V 0.3%E; Y/Y: 3.0% V 3.0%E

(JP) JAPAN DEC VEHICLE PRODUCTION Y/Y: 4.2% V 6.6% PRIOR

(AU) AUSTRALIA DEC PRIVATE SECTOR CREDIT M/M: 0.7% V 0.5%E; Y/Y: 5.6% V 5.4%E

(AU) AUSTRALIA DEC NAB BUSINESS CONFIDENCE: 6 V 6 PRIOR; CONDITIONS: 11 (6-month high) V 6 PRIOR

Asia Session Notable Observations, Speakers and Press

Tremors from US president Trump's broad-sweeping executive order on immigration curbs from 7 Middle East countries continue to be felt in the markets, as safe-haven JPY and Gold remain bid while Asian equities and US futures are under pressure. Obama-appointed Acting Attorney General Sally Yates has instructed DoJ attorneys not to defend the EO - one which has already been criticized by lawmakers of both parties, foreign leaders, tech and financials (Goldman) CEOs, and State Sec nominee Tillerson. In response, Pres Trump has fired Yates, proclaiming her to be "weak on borders and very weak on illegal immigration". Knee-jerk market response to the firing was to the downside, as the contentious stance could further polarize the anti-Trump protests and complicate the confirmation process for AG-nominee Sessions.

Today's Bank of Japan policy decision was accompanied by continued resilience of economic data, as jobless rate remained at a low 3.1%, household spending decline was lower than expected, and industrial output m/m beat consensus. As speculated BOJ raised its GDP target for FY16, FY17, and FY18 to 1.4%, 1.5%, and 1.1% respectively, while maintaining inflation expectations. In the accompanying statement, BOJ also maintained its policy of interest rates at -0.1% and JGB purchases at ¥80T, but also extended its low-rate lending facility for financials and growth industries by a year. Finally, BOJ's Quarterly statement was notably more upbeat on inflation expectations, raising Outlook for prices to "increase from 0 to become slightly positive" vs prior "Y/Y CPI likely to be slightly negative or about 0%" thanks to diminished effect of low energy price.

Australia's reporting season for output by mining and energy names was highlighted by Fortescue - company saw sequential rise in iron ore output and also affirmed FY17 shipments. CEO also noted improved demand in China steel sector, sending shares up by over 2%.

China

(CN) S&P: China overseas buyers will face tougher regulatory and political hurdles this year

Japan:

(JP) Japan Fin Min Aso: Critical to reach mutual agreement with US on FX; Expects economic recovery driven by domestic demand

(JP) Barclays: BOJ likely to maintain its bond-buying duration when it unveils its Feb plans at 17:00JST - press

Australia/New Zealand

(NZ) New Zealand RBNZ Gov Wheeler expected to make an announcement on his future "fairly soon" - financial press

Asian Equity Indices/Futures (23:30ET)

Nikkei -1.6%, Hang Seng closed, Shanghai Composite closed, ASX200 -0.6%, Kospi -0.4%

Equity Futures: S&P500 -0.3%; Nasdaq -0.3%; Dax -0.4%; FTSE100 -0.4%

FX ranges/Commodities/Fixed Income (23:30ET)

EUR 1.0690-1.0710; JPY 113.25-113.85; AUD 0.7550-0.7570; NZD 0.7270-0.7300

Apr Gold +0.6% at $1,204/oz; Mar Crude Oil -0.4% at $52.40/brl; Mar Copper -0.3% at $2.66/lb

(KR) South Korea sells KRW1.1T 3-month bonds, avg yield 1.37%

Asia equities/Notables/movers by sector

Consumer discretionary: NVT.AU Navitas Ltd -6.1% (H1 result); 6923.JP Stanley Electric Co +6.1% (9-month result); 9831.JP Yamada Denki -2.4% (9-month result speculation); 9022.JP Central Japan Railway Co -2.8% (9-month result)

Industrials: 4005.JP Sumitomo Chemical +4.5% (9-month result); 000270.KR Kia Motors Corporation -3.3% (US sales speculation); 7261.JP Mazda Motor Corp -3.5% (FY16/17 result speculation); 7270.JP Fuji Heavy Industries Ltd -3.3% (Jefferies cuts rating); 6305.JP Hitachi Construction Machinery -4.5% (9-month result); 9064.JP Yamato Holdings Co -5.4% (9-month result); 4005.JP Sumitomo Chemical Co +4.3% (9-month result)

Technology: 6758.JP Sony Corp -2.1% (share sales); 6502.JP Toshiba Corporation -2.7% (speculated to cut stake in Westinghouse); 6701.JP NEC Corp -16.1% (9-month result)

Materials: ERA.AU Energy Resources of Australia -4.9% (prelim FY16 result); FMG.AU Fortescue Metals Group +2.7% (Q2 result); ILU.AU Iluka Resources -2.4% (Q4 result)

Energy: TAP.AU Tap Oil -1.1% (Q1 result); 5020.JP JX Holdings -2.0% (earnings speculation); ORG.AU Origin Energy -2.1% (Q2 result)

Healthcare: 2413.JP M3 Inc -4.9% (Sony sells stake); VRT.AU Virtus Health -17.7% (H1 result)

Utilities: 9505.JP Hokuriku Electric Power -10.5% (9-month result)

STOCKS

Corrective dip seen in the equities overall. But on a longer term the trend remains bullish. All eyes focus on the FOMC and the Indian Union Budget due tomorrow.

Dow (19971.13, -0.61%) came down to test 19870 yesterday and closed at levels just below 20000. We could possibly see a test of 19720 again in the near term before bouncing back towards 20000-20200 levels. The FOMC meeting tomorrow could also bring in some momentum which could be the driver for the coming weeks. Above 20200, we are open to test 20500-20700 zone.

Dax (11681.89, -1.12%) also saw a sharp fall yesterday in line with the weekly candle resistance. But while the support at 11400 holds, we remain bullish for the medium term. We have already seen levels of 11680 as mentioned yesterday.

Nikkei (19116.84, -1.30%) could possibly be headed towards 18800-18700 support levels from where it could reverse the immediate trend.

Nifty (8632.75, -0.10%) was almost stable yesterday and could trade within the 8600-8700 region today also. Some volatility may come into the markets after the Budget tomorrow.

COMMODITIES

Gold (1200.65) and Silver (17.184) have moved up on fresh Dollar weakness. But we would have to consider resistances in the 1210-1215 region on Gold and 17.50-18.00 region on Silver which could hold in the near term bringing prices back to lower levels.

Brent (55.15) and WTI (52.35) are trading low, with the WTI falling faster than the Brent. They could test 54.25 and 51.65 over the next couple of sessions before bouncing back towards 56 and 54 respectively. Overall the crude prices may remain ranged in the near term.

Copper (2.6630) saw a slight dip but is trapped within the immediate support near 2.60-2.65 and weekly resistance near 2.70-2.72 regions respectively. The commodity price could remain range-bound in the 2.60-2.75 region for some more time.

FOREX

As discussed yesterday, the markets will be keen to know the Fed's path for increase of interest rates after the FOMC meeting on Wednesday, especially in light of the weak Q4 GDP data in the USA. The weakness of Dollar continues.

Dollar Index (100.35) has been holding above the support of 100.05-99.75 despite the failure to rise above 101.20-25, the near term resistance we have been watching. The swing high of 101.02 becomes the new reference point as only a higher high may signal a reversal to the upside. The near to medium term direction may be set by the FOMC announcement coming tomorrow.

Just like Dollar Index, Euro (1.0705) has established the swing low of 1.0620 as the new reference point as the near term uptrend remains intact as long as it stays above this support. A gradual rise to 1.0725-50 can’t be ruled out but the next few sessions may see a consolidation in the region of 1.0650-1.0750.

Dollar-Yen (113.34) has broken below 113.85-65 as written yesterday after the BOJ kept the rates unchanged but if the decline is contained within the major support around 112.80-50, then another bounce to 114.00-50 can’t be ruled out.

Pound (1.2517) is in a shallow corrective mode with the major support coming at 1.2400. The upside possibilities remain open till iy stays above 1.2400 but the resistance around 1.28 may keep it rangebound in 1.2400-1.2800 for the next couple of weeks.

Aussie (0.7570) is rising in a very feeble manner but the weekly resistance near the current levels caps the immediate upside and keeps the chances of seeing 0.74 in the near term open.

Dollar-Rupee (67.75) is trading at 67.75 in the NDF market, which signals a potential breakdown of the 6-week range of 67.90-68.40 to the downside and opens up 67.70-60 as the near term target/support.

INTEREST RATES

Despite the Dollar (100.35) weakness in the near term, Euro (1.0705) has failed to capitalize on it as the German-US 10Yr yield differentials (-2.04%) still remains unable to break above the medium term resistance of -2.00%.

On the other hand, the US-Japan 10Yr (2.40%) remains almost unchanged and the BOJ keeping its rates unchanged as per the market expectations has not triggered any sharp moves, opening up the possibility of keeping Yen (113.34) stable in the near term.

Pound is technically still strong but the upside may be limited in the near term as the UK-US 10Yr (-0.95%) faces a major long term resistance at the current levels.

A Tale of Two Weeks

A tale of two weeks and how quickly investor sentiment can turn. Last week, Tumpenomics' rally has given way to a vote of no confidence from investors who are growing leery of President Trump's agenda and are restless about the lack of focus on the fiscal front.

The weekend's immigration headlines have won the president few friends globally. There's an increasing level of unease amongst investors that the recent executive orders are eroding minted political relationships abroad and will have a negative impact on US trade negotiation.

While the Muslim travel ban may have been universally condemned, keep in mind, capital markets lack a moral compass, and while it makes a compelling storyline, the market meltdown overnight was investors voting with their feet in a direct challenge to the Tump-inflation trade. Sure the immigration ban was risk adverse, but leeriness will quickly fade if the US administration comes through on the fiscal front.

While the markets have started the week on a sour note, it is not the time to bury your head in the sand as we are in for one of the busiest data calendars in some time. The key risk events are the three central bank events: the BoJ, FOMC and the BoE, where we have the Quarterly Inflation Report. Last of all and at the top of my agenda, Friday's granddaddy of all data releases, US Non-Farm Payroll

The BoJ is expected to give their policy announcement between 10 am to 11:30 am (Singapore time), but as we have seen so often in the past, there is no specific timetable for the release. Nonetheless, the BoJ is not expected to yield any real surprises as they will likely be more than happy to leave policy unchanged and continue to see inflation drift towards their target. However, the markets may be on forwarding guidance watch after reports that the BoJ is looking into how they could raise their 10y bond yield target from zero in the future without roiling the financial markets, as market chaos usually ensues if the BoJ surprises.

Speaking of which, it was a year ago yesterday when the BoJ unexpectedly slashed rates into negative territory for the first time and kicked off the seven-month chase for yield with dominated trade flow through much of 2016. Let's see what rabbit the BoJ pulls out of its hat later today.

Australian Dollar

The Aussie has been stuck in the muck, over the past 24 hours while the Kiwi has basked in the sun. The market is voicing their opinion on the probable course of each country's monetary policy. While the AUD has sat glued to .7555-60 level overnight, the Kiwi appears ready to test the rarified air above .7300 once again.

To be honest, I had to take a second at my Aussie screen as I thought it was a stale price given the unwind and about-face we have seen on the broader USD sentiment overnight.

It once again illustrates the importance of the Carry, in the 3C equation (Carry Commodity and China) for the Aussie dollar, and I believe last week's weaker than expected Australian CPI will continue to dampen enthusiasm for the Australian dollar.

Japanese Yen

For USD JPY, the focus is all on today's the BoJ monetary policy meeting , where it is widely believed the policy will be left unchanged. However, dealers will be homing in on forwarding guidance after reports surface that the BoJ was looking for ways to taper for 0% 10 Year Rinban targets. But, it is likely too early for the BoJ to rock the boat despite the recent uptick in inflation.

I believe the shift away from 0% 10 years' is inevitable given the likelihood of US 10 Year Yield moving above 3% and global yield shift higher. It sure feels like the markets' love affairs with Trumpenomics is fading with USDJPY falling below 114 coat tailing the 1% drop in the S&P. While the move was triggered after the US economy, it's difficult to determine just how much the move is related to pre-data position expectations, month-end rebalancing or risk off. I suspect the truth lies within all.

Keep in mind the recent run of US economic data, including Friday miss on USD GDP has also weighed on sentiment. But really after some 13 % rally on the S&P let's not get to wound up my a relatively minor retracement.

The technical edges remain entrenched 112.50-115.50

Asia FX

Not much happening due the holidays , but the market is very much tethered to movement in the broader USD. But I think we're entering some very important times as the markets are digging for clues on the Trump policy front and the market is cautious to not get ahead of the plot this time around.

Positioning is relatively neutral but I maintain risk is gibbous to US Fiscal and Trade headlines, but there remains a thick air of caution permeating the APAC FX landscape

A couple of weeks ago, we were looking for a possible GBP/JPY counter-trend long. The Beast was sitting at a horizontal support/resistance zone and if it had have held then we were looking for that first intraday pullback to get long off of. But alas the level didn’t hold and price dropped lower through it.

Three weeks later and price is back at the zone again and the setup has some real promise.

GBP/JPY 4 Hourly:

That looks like a textbook trend line breakout which if you keep reading, would mean a possible entry short on a re-test. But how often do we see the textbook setups like this fail miserably. Nothing in forex trading is textbook! If it is written in a textbook then the smart money will so often do the opposite otherwise everyone would make money.

Ah this trading game is a strange one, I know!

GBP/JPY 15 Minute:

So now zooming into an intraday chart, with that 4 hour horizontal support/resistance zone looking like it’s holding for now, the play might actually be to look to get long.

Your options are to aggressively get long on this current pullback if you think that the support zone has held, or you can wait and see if it properly breaks higher and then buy the first true pullback once you have that confirmation.