GBPJPY Analysis – Market Purges Downward Into the Discount Array
GBPJPY purges downward into the discount array after hitting the 172.10 supply zone. From the supply zone, the selling pressure caused prices to sink downward. Price broke the previous low and eventually led to a change of character to the downside.
GBPJPY Significant Zones
Demand Zones: 163.000, 148.600
Supply Zones: 169.00, 172.10
Until November 2022, the market was moving in an upward direction. From the demand zone at 148.60, the GBPJPY expanded upward, grabbing sell-side liquidity at an old low that was created on March 8, 2022. Price continued to rally in fractals into the 172.10 supply zone. On March 16, 2022, the price was delivered to the upside, and the bullish order block formed in this process was used to propel the price upward in the later part of the month. The bulls targeted the hip of the swing leg. When the price hit its swing high, the bulls pulled out of the market in favor of the bears.
On September 24, 2022, GBPJPY sank into a liquidity pool to execute buy orders. After an explosive expansion that broke the double top, the price entered the supply zone at 172.10 to execute sell orders. From the 172.10 supply zone, the price invalidated a double bottom to hit the 163.00 support. From the diagonal resistance that just emerged early last month, the price seems to be heading into the Fair Value Gap alongside the diagonal resistance.
Concerning the trendline, the market’s order flow is now bearish on the four-hour chart. A double top pattern has emerged on the four-hour chart, and GBPJPY is expected to break the double top’s neckline into the daily Fair Value Gap.
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