Technical Analysis – GBPJPY rallies towards new 44-month high; next stop at 160.00



GBPJPY posted six straight green days and today is continuing the bullish rally towards a fresh 44-month high around 156.57.

The pair jumped well above the medium-term descending trend line and any closing candle beyond the previous high of 156.50 could endorse the positive bias.

Technically, despite the fact that the stochastic oscillator is standing in the overbought region, the index is creating a bullish crossover within the %K and %D lines, pointing upwards. Also, the RSI is surpassing the 70 level with strong momentum. In trend indicators, the red Tenkan-sen line is moving above the blue Kijun-sen line and the price is standing above the Ichimoku cloud.

Looking for resistance levels, some stabilization is expected to occur around the 160.00 psychological level, registered in June 2016. Above this crucial line, the high from April 2016 at 162.80 may halt the bullish moves.

In the event of a downside reversal, the spotlight will fall back to the 152.80-153.40 support area, which has been quite active from August onwards. If this fails to hold this time, the bears may push for a close below the Ichimoku cloud, moving towards the 23.6% Fibonacci retracement level of the upward wave from 129.30 to 156.06 at 149.75.

Summarizing, GBPJPY could extend its trendline breakout towards the 160.00 handle though some caution is required as the pair is trading near the overbought territory.  

Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.

All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.

Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.

We are using cookies to give you the best experience on our website. Read more or change your cookie settings.

Risk Warning: Your capital is at risk. Leveraged products may not be suitable for everyone. Please consider our Risk Disclosure.