Technical Analysis – GBPJPY sellers unable to effectively contest ascent



GBPJPY is hovering above its previous high of 153.39 as negative pressures lack the backing to gain an advantage. The advancing simple moving averages (SMAs) are endorsing the positive picture, while the Ichimoku lines are demonstrating that the bullish drive is intact.

Nonetheless, the short-term oscillators are conveying mixed signals in directional momentum. The MACD, beyond the zero mark, is holding above its red trigger line, while the RSI, which deflected off the 70 level, is falling towards a trend line. The stochastic oscillator is suggesting positive impetus is starting to wane and is promoting a price pullback.

If buyers sustain strength off the 153.39 level, initial upside constraints could develop near the 39-month high of 154.42 ahead of the 155.41 barrier, the latter being the 150.0% Fibonacci extension of the down leg from 144.94 until 124.00. Overcoming these obstacles, the resistance zone from the 156.00 handle until the February 2018 peak of 156.60 could then challenge bullish sentiment. Surpassing this buffer zone too may subsequently encourage buyers to target the 161.8% Fibo of 157.89.

Otherwise, sellers could face preliminary downside friction from the Ichimoku lines at 152.76 and 151.80 respectively, ahead of the 50-day SMA at 151.30. Diving into the Ichimoku cloud may then produce a stronger price retracement aimed at the key 148.51-149.04 support base. Surrendering extra ground from here and, more importantly failure by the neighbouring buffer zone of 147.39-148.10 to oppose a deeper decline, could prove significant to undermine the positive structure.

Concluding, GBPJPY’s uptrend remains intact above the 151.30 low, the 50-day SMA and the Ichimoku cloud. However, its soundness could be thrown into question should a correction extend beneath the boundary of 147.39-148.10.

 

 

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