GBPJPY Analysis: Market Struggles At 184.010 As The Price Posts Bearish Divergence
GBPJPY struggles at 184.010 as the price posts a bearish divergence. After breaking free from an inverse head-and-shoulders pattern, the market went on a bullish run. Looking at the Moving Average Cross, it’s apparent that the price has been mostly bullish, with the bears struggling to make an impact. However, the current situation has GBPJPY facing major resistance at 184.010, which suggests a significant drop could be on the cards.
GBPJPY Significant Zones
Demand Zones: 172.130, 155.350
Supply Zones: 184.010, 195.880
From the previous high of 169.270, GBPJPY went into a consolidation phase. During this time, an inverse head-and-shoulders pattern emerged. Once this pattern was established, the price broke upward as the neckline lost its significance. The uptrend continued until a notable swing high was formed at the psychological level of 166.000. This led to a substantial retracement, but the bulls eventually regained control of the market from the discounted price zone.
With bullish momentum taking over, GBPJPY climbed higher, briefly retracing at 172.130 before shooting up again due to strong bullish pressure. The uptrend continued almost without any pullbacks until it encountered major resistance at 183.910, followed by 186.760, where consecutive swing highs formed. However, the Relative Strength Index (RSI) revealed a bearish divergence by showing a lower high while the price made higher highs.
Market Expectation
On the four-hour chart, the uptrend has run its course, as the price keeps dipping below 184.010. The current trading range extends from a low of 176.310 to a high of 186.760. After a recent surge in buying interest, GBPJPY is expected to move downward toward the discounted price zone.
Note: Forexschoolonline.com is not a financial advisor. Do your research before investing your funds in any financial asset or presented product or event. We are not responsible for your investing results.
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