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GBPJPY Flickers Green In A Directionless Market

GBPJPY is mostly edging sideways and has recently found some footing off the 150.96 level, this being the 23.6% Fibonacci retracement of the up leg from 134.39 to 156.06. The flattening out of the 50- and 100-day simple moving averages (SMAs) is transmitting a lack of clear price direction, while the soaring 200-day SMA is defending the positive structure.

Furthermore, the Ichimoku lines are not indicating a convincing price preference, while the short-term oscillators are also reflecting mixed signals in directional momentum. The red trigger line has merged with the zero threshold, and the MACD is only just beneath it, while the upward pointing RSI has managed to return slightly above its 50 neutral mark. The stochastic %K line has bounced off the 20 oversold level and crossed over the %D line, signalling a minor increase in positive forces.

Currently, buyers are facing upside limitations emanating from the 50-day SMA at 151.63 up to the Ichimoku cloud’s upper surface just shy of the 152.00 hurdle. Overstepping the cloud, the next barrier to impede the climb in the pair is the 100-day SMA at 152.83. Then, looming overhead is the 153.30-154.06 border, which buyers would need to conquer to fuel additional bullish momentum, in order to challenge the zone of resistance between the 155.14 and 155.47 highs, achieved in the second half of June.

If gains become curbed and sellers resurface, initial support could commence at the 23.6% Fibo of 150.96. Shifting below the 151.00 handle, the bears may target the 200-day SMA at 149.69 and the adjacent support foundation of 148.51-149.41, which has safeguarded the positive structure since March 24. From here, should this critical base give way, a neighbouring barricade from 148.10 until 147.39, which encapsulates the 38.2% Fibo and the 147.95 region, a peak from December 2019, may challenge the potency of negative pressures.

Summarizing, GBPJPY is displaying a minor inclination to the upside. Its neutral-to-bullish tone remains intact above the 23.6% Fibo of 150.96 and the 200-day SMA. A clearer direction could form with a break either below 148.45 or above 154.06.