GBPJPY Resumes Its Upward Trend As Price Leaves The Discount Zone

GBPJPY Analysis: The Market Resumes Its Upward Trend As Price Leaves The Discount Zone

GBPJPY resumes its upward trend as the price leaves the discount zone of the previous trading range. The market traded in a range between 184.0100 and 172.6800 and has been on a bullish trend since breaking above the diagonal resistance in March 2023. The uptrend is likely to continue as the downward correction just ended in July 2023.

GBPJPY Significant Zones
Demand Zones: 172.1300, 148.6300
Supply Zones: 186.7600, 195.3400

The last candle to enter the demand zone at 148.6300 was a doji, which formed as the bulls and bears fought for control of the market in September 2023. However, as the early stages of the reversal began, the bulls lost control. The uptrend was sponsored by the Fair Value Gap (FVG), which formed as the price rose. The FVG range was filled as 2023 began. The market’s uptrend was opposed by diagonal resistance for the entire first quarter of 2023.

As the first quarter of 2023 came to an end, GBPJPY broke above the diagonal resistance. This was followed by a Market Structure Shift (MSS), which gave the price an additional boost to the upside. The MACD (Moving Average Convergence Divergence) has been bullish since the breakout. The price of GBPJPY declined on July 4, 2023, reaching the 62.0% Fibonacci retracement level of the trading range. However, it appears that the market is back in an uptrend, and GBPJPY is likely to continue rising until it reaches the 195.3400 price level.

Market Expectation

The market is currently moving upwards on the four-hour chart. A pullback to the downside could occur as a result of the selling pressure at 186.7600. However, the four-hour FVG at 180.5000 is expected to be hit, at which point GBPJPY is expected to resume its uptrend.