GBPJPY Keeps Breaking Previous Highs as Directional Bias Remains Bullish

GBPJPY Analysis: Price Keeps Breaking Previous Highs As Directional Bias Remains Bullish

 GBPJPY keeps breaking previous highs as the directional bias remains bullish. The market has been in an uptrend since the shift in market structure in January 2023. The new year seems to be void of sellers’ dominance as previous highs keep getting invalidated.

GBPJPY Significant Zones

Demand Zones: 157.780, 155.360

Supply Zones: 169.080, 172.130

The GBP/JPY market has been quite choppy in the higher timeframe. This is because prices fluctuate within a defined range bounded by the 169.080 resistance and the 157.780 support. In September 2022, a massive crash was experienced as the Great British Pound suddenly collapsed against the Japanese Yen. However, the sellers were caught red-handed as the price swerved exuberantly, filling the range covered by the bearish marubozu candlesticks. The subsequent bullish trend continued until the 169.080 resistance was breached as GBPJPY flew up to hit the 172.130 demand level.

The selling pressure from the 172.130 demand level in the premium zone caused a change of character to the downside. The 169.080 price level was retested three times before a massive crash ensued. The massive crash invalidated the 163.070 swing low, therefore leading to the execution of more sell orders. Price crashed into the 155.360 demand zone, thereby leading to a reversal that initiated the current trend. Following the failure swing at the 155.650 low and the shift in market structure (SMS), more long positions were placed. GBPJPY remains bullish even after the invalidation of the previous high at 166.010 price level.

Market Expectation

On the four-hour chart, GBPJPY is bullish as the price algorithmically keeps expanding in fractals. However, following the buy-side liquidity grab above the 166.850 price level, GBPJPY is likely to retrace into the four-hour FVG. After the retracement, the uptrend is likely to continue.