GBP/JPY is trading in a short-term channel up. This junior pattern was formed after the rate breached the bottom boundary of a senior channel. The price halted at 145.35 and returned to test this line today. Subsequently, the price plunged mid-session caused supposedly by weak US data. In general, two scenarios are possible. First, even though technical indicators flash solid bullish signals, it is apparent that the strong uptrend that guided the Sterling in the junior channel is weakening, thus rising doubts of its ability to edge higher. Likewise, other bullish indicators show signs that bears may prevail in the upcoming trading days. The breakout of the 200, 100– and 55-hour SMAs due to US fundamentals should sustain for the upcoming hours to confirm a downtrend. Second, the Sterling may appreciate and return in the senior channel. The given upward momentum could continue until the 148.00 mark where the 2017 high is located.
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The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.