GBPJPY Sustains Bullish Trend

GBPJPY Analysis – May 10

The GBPJPY pair has been steadily increasing in price, exhibiting a bullish trend and reaching an all-time high in late April 2024. This suggests strength in the GBP as the price continues to show no signs of reversing its upward trend.

GBPJPY Significant Zones

Resistance Levels: 197.900, 202.000
Support Levels: 190.300, 185.100

Since early February 2023, the GBPJPY has exhibited a consistent bullish trend, characterized by a series of higher highs and lows, with minimal volatility. This steady ascent was disrupted in late April 2024 when a surge in market volatility propelled prices to breach the established trend line resistance. This breakout suggests an aggressive influx of buyer orders, setting the stage for a potential continuation of the bullish momentum.

Upon achieving this significant climb, the price action underwent a retracement, finding support at a bullish order block close to the trend line support, indicating interest from buyers to enter the market at a more favorable price. This pullback is seen as a preparatory phase before the resumption of the uptrend. The Moving Average (MA) on both the daily and 4-hour timeframes corroborates the upward trajectory, as the price is currently positioned above the MA lines, signaling continued bullish sentiment

Conversely, the 4-hour chart formulated a reverse head and shoulders reversal pattern just as it encounters resistance at the bullish order block providing confluence for a bullish tendency on the short-term trend. However, The RSI touching the 70.0 overbought mark on this timeframe, hints at the possibility of an impending pullback, or at least a temporary deceleration in the bullish pace.

Market Expectation

The market is expected to undergo a decline on the 4-hour chart, leading to a retracement. This retracement is likely to attack liquidity above the bullish order block on the 4-hour chart, engineering a bullish momentum in price.

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