GBP/JPY: Trades at a Critical Point

• GBP/JPY has been on a bearish correction may end up making a significant breakout.
• The pair trades right at the SMA 30’s support.
• The H1 chart has been bearish heading towards the South.
• Intraday minor charts have been bearish.

GBP/JPY – Technical Analysis- H4 Chart

The chart shows that the price after making a long bullish move found its resistance around 190.000. Upon producing a bearish inside bar, the pair has been heading towards the downside to find its support. As of writing, the pair trades right at the simple moving average 30’s support. It may end up making a bearish breakout here. If that happens, the pair may continue its bearish move and find its next support around 187.500.

However, if the SMA 30 holds the price as a support and ends up producing a bullish reversal pattern, the buyers may push the price towards the North. In that case, the price may find its resistance around 190.000 again.

Price Action Analysis- H1 Chart

The chart shows that the price after making a bearish move had a bounce at 188.830. It then consolidated there for a while. However, upon producing a double top, it has headed towards the downside and breached the significant support at 188.830. The sellers may be keen to go short in the pair based on this chart and drive the price towards 188.000.

The buyers, on the other hand, may have to wait for a strong bullish move breaching 189.300 to look for long opportunities. In that case, the level of 190.000 may come into play and work as a resistance again.

The H1 looks bearish but the H4 chart is indecisive. It could go either way. Thus, the H1 chart may play a vital role to determine its next route.

Written by: Md Tareq Sikder, Senior Analyst Forex Prop News

Contact and follow Tareq on Twitter: @tareqfpn