- GBP/JPY has been having a strong bearish correction
- Simple Moving Average 30 still works as a support
- The H1 Chart looks bearish
- Minor Intraday charts have been bearish
GBP/JPY-Technical Analysis-H4 Chart
The pair has been searching for its direction on the H4 chart since last week after making a strong bullish move. It found its horizontal support around 183.400 and had a bounce twice. At the second bounce, it produced a bullish inside bar and headed towards the North. On its way, it made a breakout at Simple Moving Average 30. As expected, the price then made a bearish correction and headed towards the upside again. However, it had a rejection around 186.00. Since then the price has been heading towards the South with strong bearish momentum. SMA 30 still holds the price as a support. Thus, buyers may keep their eyes on the pair to go long upon having a bullish reversal pattern. The price may find its next resistance around 186.700.
On the downside, a bearish breakout at SMA 30 may attract the sellers to go short upon having breakout confirmation.
Price Action Analysis-H1 Chart
While the H4 chart favors the Bull, the H1 chart looks good for the Bear. At the last bullish move, the price made a momentous bullish breakout at 185.230. It consolidated for a while and then continued its bullish journey with strong momentum. The price upon finding its resistance around 186.000 has been bearish on the H1 chart. The price breached the breakout level. As of writing, the level works as a flipped resistance. The sellers may be interested in selling the pair if the level produces a bearish reversal pattern. However, if the price goes back above the breakout level, then the buyers may look to go long and push the price towards the upside.
The H4 and the H1 charts’ price action are contradictory. Thus, traders are to take trading decisions cautiously around this area.
Written by: Md Tareq Sikder, Senior Analyst Forex Prop News
Contact and follow Tareq on Twitter: @tareqfpn