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Morning Market Updates – GBP/JPY

By:
Sylvester Stephen
Updated: Jul 14, 2017, 11:07 UTC

It looks like the sterling is on track to extend its gains against the Yen. The GBP/JPY has now jumped from the 50EMA and went beyond the 145.646 handle.

GBP/JPY

It looks like the sterling is on track to extend its gains against the Yen. The GBP/JPY has now jumped from the 50EMA and went beyond the 145.646 handle.

On the four-hour chart, the pair is now forming a bullish reversal, and signals a trend continuation. The pair has now advanced after the sideways move and proves to be strong at 145.646.

The GBP/JPY pair has managed to gather a new positive momentum to get rid of the intraday sideways range and has formed a new bullish wave to settle around the current levels. We expect the pair to move towards the previously recorded top at 147.785 with a new positive wave that eases the attempt to gather additional momentum and increases the chances of breaching the above mentioned barrier.

If the price keeps advancing, the resistance could be met around the highest price of 147.785. Further up, a potential level, mainly the 147.785 handle, combined with the highest price of May, might form an additional barrier to the upside.

The short-term momentum as depicted by the stochastic is bullish. Specifically, the indicator is well above its 50 neutral-perceived level and is currently maintaining a positive slope. It is important to note that though the price is at 69, it is close to the 70 overbought levels.

Should the price decline, the area around the 145.646 handle, which is another potential level that was of significance in the recent past, could provide support. Further decline would shift the focus to the area around the current levels of the 50-day moving average (MA) at 145.226 for additional support. However, it has to break the moving average to reach the levels which signal a bearish wave.

Regarding the medium-term outlook, the pair recorded a bullish signal. This is a positive medium term signal whose strength is supported by the price being above the 50 and 100-day MAs. The divergence between the price and the two MAs could be a sign of an extending rally.

Immediate resistance could be seen near 147.785 levels, above which the cross seems all set to
surpass the 147.785 handle and aims towards testing its next hurdle near the 148.085 region
mark.

Overall, both the short and medium-term movement is currently bullish. The expected trading range for today is between 145.226 support and 148.085 resistance levels.
For more detailed analysis from the author, please visit NoaFX.

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