Simple Moving Average(SMA) 50-period (red), 200-period (bold, gray)
RSI-14 with Simple Moving Average 5-period of RSI attached.
Elliott Wave Principles
Market and Price Action (patterns, candlesticks)
Intraday pivots and Intermediate-term support and resistance
Multiple Time-frame Analysis
- The messy price action in GBP/JPY is shaping out to be a rising wedge or diagonal triangle, and could have completed theABCDE waves.
- In this scenario, a decline is targeting 129.50, the base of this pattern.
- The 132.60 level is the first near-term support as we end this week, or start the next.
- There is also a channel support near 132.30 area. This is the current target.
- Reaching this target itself gives clues that the market has topped by breaking below 61.8% retracement of the latest upswing, as well as the pivot near 132.60-132.70.
- On the otherhand, the rally in the GBP/JPY has picked up rhythm, bouncing off the SMA 50, as pushing the RSI above 70.
- Therefore a break below the SMA 50 adds further strength to our bearish scenario.
- The daily chart hows the this 134.00 area is indeed very important, though a break above the current high at 134.25 suggests a test of the 135.00 level. An a break above that should see acceleration towards the 137.65 area.
- However, if the market does return back below 132.30, it could be returning to 129.50 first.
Has the GBP/JPY completed a rising wedge? We would love to hear what you think.
Subscribe and become a member to share your views and join live discussions as well as webinars about the markets.
Fan Yang CMT
Chief Technical Strategist