- GBP/JPY has been in a strong bearish trend on the H4 chart.
- The pair trades around a resistance at 183.560.
- The H1 chart is very bearish.
- Intraday minor charts may make some corrections.
GBP/JPY-Technical Analysis-H4 Chart
The chart shows that the price upon finding its horizontal resistance around 185.700 made a strong bearish move. On its way, it made a bearish breakout at the Simple Moving Average 30. The price consolidated around the breakout area for a while. It then produced a bearish engulfing candle. That attracted the sellers to go short on the pair. The price has been heading towards the South with good bearish momentum. As of writing, the pair trades around 183.560. This is a level, where the price reacted several times earlier. Thus, this level may hold back the bear for a while. A breakout below the level may drive the price towards the South further. The price may find its next support around 181.400.
On the upside, it does not look promising for the bull. It may make a correction upward. However, the buyers must wait for the price to produce a strong bullish reversal pattern or a bullish move breaching the SMA 30.
Price Action Analysis-H1 Chart
The H1 chart shows that the price has been heading towards the downside with severe bearish momentum. It has been obeying a bearish trend line as well. Thus, the sellers may keep their eyes on the pair to find short opportunities. As of writing, the price seems to be having a bullish correction. It may be extended to find its resistance. However, if the pair produces a bearish reversal pattern such as a double top, the sellers may go short below the double top’s neck line. The price may find its next resistance around 182.600.On the upside, it does not look as bad as the H4 chart. The H1 chart has some space to travel towards the North. The price may find its next resistance around 182.250.On the upside, it does not look as bad as the H4 chart. The H1 chart has some space to travel towards the North. The price may find its next resistance around 182.250.
The H4 and the H1 chart look good for the bear. On the H1 chart, we may see relatively a long bullish correction. However, it is a pair that traders should look to go short to get better risk-reward.
Written by: Md Tareq Sikder, Senior Analyst Forex Prop News
Contact and follow Tareq on Twitter: @tareqfpn