1. Range-Bound Market Assumption
The analysis assumes that price is bouncing between a horizontal range (support and resistance).
However, ranges don’t last forever—a breakout or breakdown is inevitable.
Instead of expecting a structured bounce, a fake breakout or a liquidity grab could occur.
2. Support Zone Over-Reliance
The expectation of multiple support bounces is risky because:
The more times price tests support, the weaker it becomes.
A stop hunt scenario could push price below support before reversing.
If buyers don’t step in with strong momentum, a breakdown might be more likely than the predicted bullish move.
3. Resistance Breakout Bias
The projection shows a clean breakout above resistance after consolidation.
However, GBP/JPY is highly volatile, meaning:
A fakeout above resistance could trap buyers before reversing.
A rejection at resistance might cause a sharp drop instead of a rally.
4. Missing Volume & Trend Confirmation
No volume analysis is provided—breakouts need high volume for confirmation.
No higher time frame confirmation (1H, 4H) is shown, making it unclear whether the trend is truly bullish or just ranging.
Alternative View
Instead of assuming a smooth upward breakout, consider:
Bearish Scenario: A false breakout above resistance followed by a strong reversal.
Liquidity Grab: A dip below support before an actual reversal.
Wait for confirmation: If price closes above resistance with volume, a buying opportunity is stronger
The analysis assumes that price is bouncing between a horizontal range (support and resistance).
However, ranges don’t last forever—a breakout or breakdown is inevitable.
Instead of expecting a structured bounce, a fake breakout or a liquidity grab could occur.
2. Support Zone Over-Reliance
The expectation of multiple support bounces is risky because:
The more times price tests support, the weaker it becomes.
A stop hunt scenario could push price below support before reversing.
If buyers don’t step in with strong momentum, a breakdown might be more likely than the predicted bullish move.
3. Resistance Breakout Bias
The projection shows a clean breakout above resistance after consolidation.
However, GBP/JPY is highly volatile, meaning:
A fakeout above resistance could trap buyers before reversing.
A rejection at resistance might cause a sharp drop instead of a rally.
4. Missing Volume & Trend Confirmation
No volume analysis is provided—breakouts need high volume for confirmation.
No higher time frame confirmation (1H, 4H) is shown, making it unclear whether the trend is truly bullish or just ranging.
Alternative View
Instead of assuming a smooth upward breakout, consider:
Bearish Scenario: A false breakout above resistance followed by a strong reversal.
Liquidity Grab: A dip below support before an actual reversal.
Wait for confirmation: If price closes above resistance with volume, a buying opportunity is stronger
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.