The daily chart of GBP/JPY indicates a potential bearish trend unfolding in a classic 5-wave Elliott Wave pattern. Here’s the breakdown:
Wave (1):
The initial downward impulse wave demonstrates significant selling pressure, marking the start of the bearish trend. The decline is steep, indicating strong momentum in favor of the bears.
Wave (2):
Following Wave (1), a corrective wave retraces upward to approximately the Fibonacci 0.618 level. This retracement aligns with the expected behavior of Wave (2), which typically retraces 50-61.8% of Wave (1).
Wave (3):
The ongoing Wave (3) is projected to extend significantly lower, aiming for a Fibonacci 1.618 extension near the 184.000 level. Historically, Wave (3) is often the most aggressive and extended wave, driven by heightened bearish sentiment.
Wave (4):
After reaching the 184.000 level, a minor corrective move upward (Wave 4) is expected. This wave is generally shallow, potentially retracing to the 0.382-0.500 Fibonacci level of Wave (3).
Wave (5):
The final leg of the bearish trend targets the 2.618 Fibonacci extension, estimated around 177.000. This aligns with the ultimate downside potential of the bearish Elliott Wave cycle.
Key Levels to Watch:
Resistance Levels:
193.500 (0.236 Fibonacci level)
195.000 (previous high)
Support Levels:
184.000 (1.618 Fibonacci extension of Wave 3)
180.000 (psychological level and key support)
177.000 (2.618 Fibonacci extension of Wave 5)
Market Sentiment and Trade Strategy:
The GBP/JPY pair appears to be forming a strong bearish setup, supported by Fibonacci levels and Elliott Wave projections. Traders may consider:
Sell Positions: On retracements to the 0.382-0.500 Fibonacci level of Wave (3).
Take Profit Targets: 184.000 and 177.000.
Stop Loss Levels: Above 193.500 to mitigate risks.
This bearish analysis assumes the pair respects the Elliott Wave structure and Fibonacci levels without invalidation from unexpected market events or strong bullish reversals.
Wave (1):
The initial downward impulse wave demonstrates significant selling pressure, marking the start of the bearish trend. The decline is steep, indicating strong momentum in favor of the bears.
Wave (2):
Following Wave (1), a corrective wave retraces upward to approximately the Fibonacci 0.618 level. This retracement aligns with the expected behavior of Wave (2), which typically retraces 50-61.8% of Wave (1).
Wave (3):
The ongoing Wave (3) is projected to extend significantly lower, aiming for a Fibonacci 1.618 extension near the 184.000 level. Historically, Wave (3) is often the most aggressive and extended wave, driven by heightened bearish sentiment.
Wave (4):
After reaching the 184.000 level, a minor corrective move upward (Wave 4) is expected. This wave is generally shallow, potentially retracing to the 0.382-0.500 Fibonacci level of Wave (3).
Wave (5):
The final leg of the bearish trend targets the 2.618 Fibonacci extension, estimated around 177.000. This aligns with the ultimate downside potential of the bearish Elliott Wave cycle.
Key Levels to Watch:
Resistance Levels:
193.500 (0.236 Fibonacci level)
195.000 (previous high)
Support Levels:
184.000 (1.618 Fibonacci extension of Wave 3)
180.000 (psychological level and key support)
177.000 (2.618 Fibonacci extension of Wave 5)
Market Sentiment and Trade Strategy:
The GBP/JPY pair appears to be forming a strong bearish setup, supported by Fibonacci levels and Elliott Wave projections. Traders may consider:
Sell Positions: On retracements to the 0.382-0.500 Fibonacci level of Wave (3).
Take Profit Targets: 184.000 and 177.000.
Stop Loss Levels: Above 193.500 to mitigate risks.
This bearish analysis assumes the pair respects the Elliott Wave structure and Fibonacci levels without invalidation from unexpected market events or strong bullish reversals.
Disclaimer
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.
Disclaimer
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.