• Trade deal sticking points remain
  • Trade talk to resume this weekend
  • Double Top pattern in GBP/JPY (H4)

Post-Brexit trade deal talks were disrupted recently after a member of the EU negotiating team was tested positive for COVID-19. As EU’s chief negotiator Michel Barnier was forced to self-isolate, talks were held virtually at the moment. Nonetheless, the UK was hoping that face-to-face negotiations can take place when both countries resume talks this weekend. For now, the three sticking points – fisheries, level playing field and governance, remain to be unresolved.

Looking at the chart, we see that GBP/JPY tried to break above the 139.800 level twice this month but failed, leading to the formation of a Double Top pattern in GBP/JPY (H4). Our indicators are starting to show a sign of downward momentum. In a scenario whereby the trade negotiation continues to remain in a deadlock, we may be seeing a further downside of GBP/JPY, thus allowing the Double Top pattern to play out.

Double Top setup for GBP/JPY (H4)
Sell Stop Order at 138.80

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By Gim Hong Lee

Gim Hong has been a full-time currency trader for more than 2.5 years, focusing on day and swing trading of major currencies and their crosses. He is a frequent contributor of currency and economic analysis in Forex Trading Asia. Graduated from Columbia University in the City of New York with a bachelor’s degree in applied mathematics and statistics, the nerdy side of Gim Hong enjoys learning about data analysis, machine learning and their applications in currency trading.

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