Simplified wave analysis and forecast for GBP/USD and USD/JPY on May 23

GBP/USD

Analysis of the structure of the last medium-term wave of the British pound from March 13 shows that it is close to completion. The price of the pair is in the upper part of the wide potential reversal zone of the oldest TF. In the wave of May 3, two days ago, the final part of the wave (C) started.

Forecast:

The chance that the price of the pair will slip through the zone of powerful support is very small. In the next day, the most likely scenario for the pound will be an upward rebound, up to the upper limit of the price corridor between the nearest counter zones.

Recommendations:

Proponents of trade within the session can make short-term sales of the pound while taking into account the limited potential of the move down. Buying the pound today can be very risky. It is recommended to refrain from trading during the price rollback and look for sell signals at its end.

Resistance zones:

- 1.2690 / 1.2720

Support zones:

- 1.2600 / 1.2570

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USD/JPY

The direction of the short-term fluctuations of the Japanese currency is given by the rising wave of May 13. In a larger wave, it gave rise to the final part (C). The wave has a high wave level, and over time, the entire movement will move to the senior TF. Since the beginning of the current week, the pair is falling, forming a correction to the previous trend section of the chart.

Forecast:

Today, in the first half of the day, the downward course of the pair's movement is expected to continue, until its completion in the support zone. By the end of the day, the probability of a change in the direction of price movement increases.

Recommendations:

Before the appearance of reversal signals, it is worth refraining from trading or to significantly reduce the lot during sales. It is necessary to take into account the limited potential of reduction. Next, when the reversal signals appear on your TS, it is recommended to look for the points of purchase of the pair.

Resistance zones:

- 110.70 / 111.00

Support zones:

- 110.10 / 109.80

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Explanations to the figures: Waves in the simplified wave analysis consist of 3 parts (A – B – C). The last unfinished wave is analyzed. Zones show areas with the highest probability of reversal. The arrows indicate the wave marking according to the method used by the author, the solid background is the formed structure, the dotted ones are the expected movements.

Note: The wave algorithm does not take into account the duration of tool movements over time.

The material has been provided by InstaForex Company - www.instaforex.com