Market Analysis: GBPJPY Experiences Symmetrical Triangle Consolidation As Emerging Bullish Signals Take Shape
The GBPJPY currency pair has shown notable volatility since March 2024. A sustained bullish trend pushed prices to a high of 207.830 in early July 2024. However, this rally was followed by an aggressive bearish reversal, marked by large bearish candlesticks and minimal retracement.
GBPJPY Significant Zones
Resistance Levels: 207.830, 200.020
Support Levels: 188.660, 180.350
After reaching the 180.350 level, the bearish momentum eased, paving the way for a gradual bullish recovery. This upward movement faced resistance at 200.020, which eventually drove the price back to the demand level of 188.660.
Analyzing the price movements from the July 207.830 high to 200.020 and the recovery from 180.350 reveals a symmetrical triangle pattern. This formation, often associated with consolidation phases, reflects market indecision as buyers and sellers vie for control.
On the 4-hour chart, a trend shift is evident with the formation of a reverse head-and-shoulders pattern, a classic bullish reversal signal. This suggests short-term momentum favors additional upward movement. The price is likely to respect the support levels within the symmetrical triangle, with further bullish activity expected unless the pattern’s lower boundary is breached.
The Relative Strength Index (RSI) on the daily timeframe places GBPJPY in oversold territory. This indicator supports the likelihood of short-term bullish momentum, as oversold conditions often precede price recoveries.
Market Expectation
While the 4-hour chart points to a bullish bias with the reverse head-and-shoulders pattern, the symmetrical triangle on the daily timeframe indicates ongoing consolidation and the potential for a significant breakout. A breakout above the 200.020 resistance level could signal a bullish continuation toward higher price levels, supported by forex signals. Conversely, a breakdown below 188.660 may renew bearish pressure, potentially targeting the 180.350 support zone.
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