The GBP/JPY rallied last week, and is showing some signs of reviving an uptrend. Let’s take a look at what the technical developments are telling us in the charts from different time-frames.
The rally last week broke above a falling trendline from 180.70, high on the year. This rally shifts GBP/JPY away from the recent bearish outlook, but only in the short-term 175-175.35 could be a key resistance area. A hold keeps a bearish outlook. In the daily chart we can see that the Sept-Oct. price action was volatile, and can be a sign of exhaustion and capitulation. Give it some elbow space around 175.35. If price can hold below 176, the capitulation scenario should still be in play. Above 176, the mode shifts back to neutral-bullish, and the highs around 180.00 will be back in sight.
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