GBP/JPY dropped below the major support level of 181.240 on Wednesday and closed below this level. Price also broke the bullish trend line last week after the Bank of Japan vowed to increase the interest rate.

Currently, the price is making a correction and will possibly retrace to the 182.860 resistance level before making a further drop. The 182.860 is a strong resistance level and is also between the two major Fibonacci levels of 0.5 and 0.61.

I am expecting the price will go for an extended bearish trend from 182.860 and will drop to 174.045 and beyond.

GBP/JPY will possibly drop significantly on Thursday when the Bank of Japan announces the interest rate decision.

It is expected that the Bank of Japan can increase the interest rates and if that happens the price of GBP/JPY will drop substantially.

•  GBP/JPY will possibly retrace to the 182.860 resistance level before dropping to new lows.
• The price of GBP/JPY will likely drop to the 174.045 support level and beyond in the coming days and weeks.
• Multiple take-profit levels have been added to secure profit along the way.
• The risk-to-reward ratio on this trade is 1:4.2.
• The entry and stoploss prices have been placed at secure levels with the least probability of getting hit.
• Good luck!

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