GBPJPY Experiences a Successful Breakout of a Symmetrical Triangle

GBPJPY Price Analysis – February 25

GBPJPY experiences a successful breakout of a symmetrical triangle during this week of trading. There was a successful break of a descending triangle on the 4th of October the previous year. GBPJPY formed the descending triangle between May and October last year. The demand zone at 149.140 held the price from going lower. The surge in the price reached 157.940, where the market formed a resistance zone. 

GBPJPY Major Market Zones

Resistance Zones: 157.940, 151.640
Support Zones: 143.640, 149.140

GBPJPY Long Term trend: Bullish

The market dropped into the previous demand zone at 149.140 on 3rd December 2021. The extreme high to the low of the range initiated the symmetrical triangle formation. GBPJPY then experiences consolidation between the 151.640 resistance zone and the 149.140 support zone. The market’s status was oversold, signified by the Stochastic indicator on the daily chart. The bulls took control and shot the market up into the 157.940 zone. Price formed a double top reversal pattern. The reversal pattern affects the lower pricing in the market. A new demand zone was created at 153.640.

The Moving Average period nine switched to beneath the daily candles on the 31st of January after a bearish candle formed. This led the price to retest the previous resistance zone at 157.940. The price experiences rejection at the price zone as only the wicks stretch out to touch the level. The market fully formed a symmetrical triangle. The market had formed lower highs and higher lows.

GBPJPY Short Term Trend: Bearish

The Moving Average period nine switched above the candles as the triangle borders were reached. This caused the market to dive beyond the restrictions of the symmetrical triangle. The demand zone at 153.640 was reached yesterday. A sharp wick is seen in the demand zone. This signifies rejection in the zone. The Stochastic also indicates that the market is moving away from the oversold zone. The market is likely to retrace towards the symmetrical triangle at 157.940 before continuing its bearish run.

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