GBP/JPY Technical Analysis: Persistent Resistance
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GBP/JPY Technical Analysis: Persistent Resistance

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Talking Points:

  • GBP/JPY Technical Strateg y: Intermediate-term: Mixed, near-term bullish.
  • GBP/JPY is showing signs of congestion, which can be dangerous for such a pair as that congestion can lead to out-sized and, at times, chaotic moves.
  • If you're looking for trading ideas, check out our Trading Guides . And if you're looking for ideas that are more short-term in nature, please check out our Speculative Sentiment Index (SSI) Indicator .

In our last article , we looked at the prior up-trend in GBP/JPY as price action exhibited signs of congestion by building into a longer-term symmetrical wedge pattern. But given the veracity of the prior up-trend, also combined with the fact that the bearish retracement in GBP/JPY caught support off of the 50% retracement of that prior bullish move, and the prospect for continued bullishness was very much alive.

Since then, we've seen a bit more congestion after a down-side break found support on a projected trend-line that had previously functioned as resistance. Buyers returned shortly thereafter, running prices higher by more than 400 pips since that support-check came in a little over a week ago.

Chart prepared by James Stanley

While GBP/JPY still carries potential for bullish-continuation, traders would likely want to await a bit of additional confirmation before looking to chase this theme-higher. For traders looking to add long exposure, awaiting a break of this zone of resistance between ¥142.45-¥142.88 could make the prospect of bullish continuation a bit more attractive. Should this take place, traders can then re-assign this zone of old resistance as support in the effort of top-side, bullish entries.

Chart prepared by James Stanley

--- Written by James Stanley , Analyst for DailyFX.com

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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