GBPJPY rejects horizontal support levels, bears regain control
November 21, 2018 (Investorideas.com Newswire) After the recent breakout of the bearish trend line resistance, the GBPJPY bulls tried rallied higher but found significant amount resistance at 149.297. Though the bulls initially breached this resistance level the sellers eventually took control of this market and formed a nice bearish pin bar right at that resistance level. The short-term traders made a decent profit by executing short with a tight stop above the tail of the bearish pinbar. Currently, the pair is slowly heading towards the broker trend line which is currently turned into support. Any bullish price action confirmation signal near the broken trend line support at 143.55 will be an excellent opportunity to execute long orders in the GBPJPY pairs.
GBPJPY technical analysis
From the above figure, you can clearly see the bulls have lost the battles with the bull at the critical resistance level at 149.297. The recent broken bearish trend line is the first bearish target for the bear. From that level, we might see some bullish bounce but any bullish price action confirmation signal will be an excellent opportunity to execute long orders. But the conservative traders of the Forex trading industry will wait cautiously for a clear breakout of the major resistance level at 149.27 to execute fresh long orders.
A daily closing of the price above the major resistance level at 149.27 will eventually turn the overall bias into the bullish mood and eventually, the pair will head towards the next major resistance level at 153.79. This level is going to provide a significant amount of selling pressure to the GBPJPY bulls and any bearish price action confirmation signal will result in massive sell orders execution. However, a clear break of the price above that level will eventually lead this pair towards the next major resistance level at 156.30. A clear break of the price above the 156.30 level will confirm the temporary change in the recent bearish trend.
On the downside, we need to break below the currency support level at 143.72 to see some fresh selling momentum. A daily closing of the price below the broken trend line support level will eventually lead this pair towards the nearest horizontal support level at 140.08. This level is going to play a very crucial since we the pair failed to break this level once in the last month. A clear break of this major support level will eventually lead this pair towards the next critical support level at 135.30. Most of the long-term investors will be cautiously waiting to execute fresh long orders at this level but an imminent break of this critical support level will target Brexit low.
The low Yielding Japanese is Yen is trading lower against most of its major rivals in the global market. On the contrary, the recent uncertainty among the British MPC officials has created tension among the long-term investors. Though the recent performance of the British economy is showing a great sign of recovery yet we need a hawkish statement from the leading MPC officials to see some surge in the GBPJPY pairs. The inflation rate report of the British economy is also going to play a vital role for the leading officials to make a decision regarding their next year rate hike program. Considering all the fundamental parameters, the overall bias for the GBPJPY pair is still unclear. The news traders are currently waiting in the sideline since they don’t have any clear clue regarding the market next movement.
In terms of technical analysis, the bulls are still ahead since they have just cleared out a major bearish trend line resistance. However, the recent correction after the breakout suggests weakness in the fresh buying momentum. The short-term traders can execute fresh long orders based on price action confirmation signal near the critical support level but the long-term traders are advised to wait for a better trading opportunity.
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