GBP/JPY – Waiting For Entry
|If we look at the daily chart of GBPJPY, we can see that Friday’s candle failed to find resistance at Kijun Sen and failed to close above it. Tenkan Sen and Kijun Sen are in very close proximity to one another which suggest strong resistance at this level, and we are likely to see a bearish cross within the next few candles, indicating lower prices to come. Tenkan Sen is downward sloping, showing there is selling momentum behind the move in the short term. Additionally, Senkou Span A is converging towards Senkou Span B, where we are likely to see a bearish Kumo future start developing. Kijun Sen is flat indicating that the price may range in the medium term. Some price consolidation would be desirable, as it would establish a stronger resistance level before the anticipated downward move.
Looking at the 4-hour chart, we can see that the price found resistance at the Kumo on the penultimate candle of Friday's session, which was also a gravestone doji – a potential sign of a reversal. Tenkan Sen is upward sloping suggesting we could see a retest of the resistance provided by the Kumo. Ideally, we would want the price to remain below Senkou Span B for our short position to remain valid. The ideal entry for this trade would be a candle close below Kijun Sen on the 1-hour chart, a close approximately below 142.800.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.