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British Pound / Japanese Yen
Short

GBPJPY → False breakdown on the background of distribution

By RLinda
Updated
GBPJPY is in the distribution phase after breaking the ascending triangle structure. Against the background of the November 2023 retest, there are not many chances to break 188.3 from the first time.

snapshot

The pound sterling both technically and fundamentally looks stronger than the Japanese yen. On the senior timeframe we see the formation of a sideways movement, which tells us about the neutrality of forces between buyers and sellers. In this case, it is acceptable to use a range trading strategy (trading from the range boundaries).
After breaking through the ascending triangle structure an impulse (distribution) is formed, the price has not yet tested the resistance of 188.3, which plays an important role. There is a high chance that the market will show a false breakout and a small correction. The key point of the correction is a test of the rising support line. If the line is broken, the price may head towards the mentioned target.

Resistance levels: 188.3, 188.66
Support levels: 185.9, 184.3

The most likely scenario is a false breakout followed by a correction to one of the above support lines, as the market currently has no potential for a resistance breakout.

Regards R. Linda!
Note
snapshot

A retest of the resistance at 188.3 is being formed.
But, as we see, at the moment there is no impulse that would continue the growth
The price is testing the level after the breakout. A false breakout may follow

Confirmation of the signal - price fixation below 188.3, or after the breakout of the blue rising line.
Ascending TriangleChart PatternsDescending ChannelfalsebreakoutFibonacci RetracementFundamental AnalysisGBPJPYGBPUSDSupport and ResistanceTrend AnalysisTrend Line BreakUSDJPY
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