GBPJPY Consolidates as Buying Momentum Subsides

GBPJPY Analysis: Price Makes A Consolidation The Buying Momentum Decreases

GBPJPY makes a consolidation as the buying momentum decreases. The market’s environment is undoubtedly bullish. However, a downturn looms as the price is now in an overbought state. Confirmed by the RSI (Relative Strength Index), which is now above the 70.0 level.

GBPJPY Significant Zones
Demand Zones: $155.350, $148.630
Supply Zones: $172.130, $185.240

A downside crash might help correct the extreme bullishness. At the same time, a total reversal might occur as the bulls get tired of placing more buy orders. As 2022 ended, the bears controlled the market. GBPJPY was declining in fractals as it formed lower lows and lower highs. The price kept crashing throughout the year’s third quarter until reaching the oversold region. According to the indication of the RSI, the 30.0 level had barely been hit before the sudden change of character.

Following the change in environment, another high-low formed. Resulting in more and more highs and lows. At the initial stage of the bullish trend, GBPJPY was bouncing off the diagonal support. However, the price skyrocketed, leaving diagonal support after the third major bounce. The price headed upward as it broke previous resistance levels due to the buying momentum. However, a retracement or a complete overall trend is needed as the price enters the overbought region.

Market Expectation

Since the breakout from the consolidation phase in March 2023, GBPJPY has been bullish. The price is currently within the triangle pattern. A downtrend is anticipated to happen soon as the buying momentum decreases.