This trade is related to the bullish bat pattern that came to my attention on the 4 hour early last week (see linked ideas). There are a few fundamental aspects weighing on the GBP at the moment. A good PMI reading today would really help this get underway. We are seeing a shift from long to short on JPY on the COT report and a few extra longs have been added for commercial traders on the GBP although longs and shorts are currently split 50/50. This would suggest we have a strong/weak situation happening which is what we look for in a currency pair to trade. The engulfing candle on the GBP/JPY chart would also suggest there is currently some buying pressure. You could wait for tomorrow to see were this candle closes to be a bit safer but I am entering at current market.
