Price Analysis – GBPJPY Is Recovering From Its Fall off Its Parallel Channel’s Middle Line
GBPJPY is recovering after it was rejected by the centerline of its parallel channel. The market has generally been undulating in an ascending parallel channel. This started on the 15th of February 2021.
The centerline of the parallel channel has been prominent in steering the price. It has alternately acted as a source of opposition and as a source of support. Its function was very evident between the 8th of April to the 7th of May when it defended the market acutely. Also, between the 11th of May to the 16th of June, it kept the market above the lower half of the channel.
GBPJPY finally broke down into the lower half of the ascending channel on the 18th of June 2021. The price decline, however, was halted at the lower border. Sellers, though, still tried to force their way out of the channel, which resulted in a candle popping its long wick out of the lower channel border.
With support from the 151.250 key level, the buyers were able to rally back into the channel and upwards in the channel. The centerline, however, resisted the market sharply and it fell back in an instant. Currently, GBPJPY has now regained support from the lower border of the channel again to confront the center line again. It remains to be seen if the price will pass through the middle line or will yet be resisted again, like in previous times.
The Parabolic SAR (Stop and Reverse) indicator has displayed its dots below the daily candles for a bullish drive. The current candle has bounced off a strong confluence which comprises the lower border of the parallel channel and the lower line of the Bollinger Band indicator.
GBPJPY Significant Zones
Resistance: 156.150, 155.200, 153.500
Support: 151.250, 149.600, 148.780
Market Anticipation
The market has conformed to a double bottom pattern, and the parallel line’s centerline acts as the neckline. The Parabolic SAR has just one dot beneath the candles on the four-hour chart. It confirms the market’s movement upwards.
The lower line of the Bollinger Band acts as support alongside the lower border of the parallel channel to propel the price upward.
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