Market Analysis: GBPJPY Prepares for a Reversal as it Resumes Bearish Trend
The GBPJPY market has recently undergone a notable bearish phase, marked by a significant price drop that breached the 191.540 level. While the pair approached the 182.400 mark, which could have suggested further bearish momentum, it encountered a bullish rejection at this level. This bullish rejection led to a temporary reversal, but the overall bearish sentiment remains strong.
GBPJPY Significant Zones
Resistance Levels: 199.270, 206.180
Support Levels: 191.150, 182.400
As the price retraced to the daily breaker block and faced resistance at the daily Moving Average, the bearish momentum was reaffirmed. The inability of the price to surpass the 182.400 level further solidified the bearish outlook. This resistance implies that any bullish moves are likely to be short-lived, with the overall trend favoring a bearish perspective.
On the 4-hour timeframe, the formation of a failed high and the overbought conditions indicated by the Relative Strength Index (RSI) support the anticipation of a bearish move. The RSI’s overbought reading is particularly significant, as it signals a potential reversal in the price trend.
Market Expectation
Both short-term and long-term technical signals suggest a bearish trend for GBPJPY. With the current price failing to break key resistance levels and the RSI indicating overbought conditions, the likelihood of a further decline is high. Forex signals suggest traders should be cautious and consider the potential for continued downward movement.
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