GBP/JPY Technical Analysis: What Does Trading Above 144.80 Suggest?
GBP/JPY Technical Strategy
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- GBP/JPY Daily chart highlights an ongoing downtrend pattern.
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GBP/JPY Daily Price Chart (May 2018 – May 01, 2019)
GBP/JPY Price Leaned Lower in April
Since the start of April, GBP/JPY has started a soft down trend based off a formation of a high on April 3rd and a lower high on April 12th and low on April 9th and a six week lower low printed on April 26th.
Yesterday, April 30th GBP/JPY produced a positive break to the upside as prices closed above 144.80 marking a bullish bias towards 146.98. However, for this to happen, resistance levels at 145.79, 146.07, 146.33 and 146.84 need to be monitored along the way.
Today May 1st GBP/JPY is facing the higher of the advancing lines on the trend lines fan originating from Feb 15th low. If prices close above 146.07 and remain above this trendline, then any rally would likely pull towards 148.09. Along the way, resistance at 147.64 will also need to be monitored.
What if Price Closes Below 144.80?
Bearish momentum would entice GBP/JPY to pull back towards 143.21 if the market clears support levels at 144.20 and a zone around 143.82 – 143.72.
GBP/JPY Prices 2Hour Chart (May 01, 2019)
We noticed GBP/JPY broke through 146.63 (the April 23rdhigh), but failed to close above the barrier. This failure was repeated 3 times today highlighting a weakness in bullish momentum, which is also reflected through the RSI reading dropping from 77 to below 70. That tentative bearish bias should be monitored closely.
If prices close above 146.63 a further upside movement would be likely towards 146.78 but resistance at 146.71 need to be in focus.
Written By: Mahmoud Alkudsi
Please feel free to contact me on Twitter: @Malkudsi
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