GBPJPY:- A Quick Recovery
GBPJPY:- The proceeded to fall a further 500 pips to the downside with entry and targets provided for within the Technical Floor. Having continued to fall it forced the monthly closure to be extremely bearish closing below 147.500 and making lows back in the support region of 145.000. Since then the prior week saw a swift recovery with price pulling back up an closing above the weekly level of Resistance now turned support. With the pair potentially got a longer-term bearish sentiment from the closure of February, we may be seeing the retracement and recovery phase before heading lower. As it stands we have a strong bullish closure above the Daily Moving Averages and back above the weekly level of 147.500. I would expect the pair the push higher back towards a previous critical support region of 148.885. A break above that would lead us into the psychological region of 150.000. For now, the overall Sentiment will remain bearish as the prior 4 weeks holds heavy against the current price. A rejection from major resistance zones would certainly interest me in finding trade setups but I will wait for the price to reach areas of high importance before making any decisions.
Previous- The high volatility of the pair has made it difficult to suggest medium-term targets as price points have been hit within a matter of days after writing.
Last weeks candle moved 670 pips at the low of the spike and ended up engulfing the prior 7 - 8 weeks worth of price action. What we will often see after such volatility is a period of consolidation or sideways movement as the currency pair looks to stabilise shortly before continuing its overall direction.
With such a dump in price, it's hard to ignore the fact that we have potentially flipped our directional bias on the pair. The bearish sentiment may well have come due to the ongoing talks on the Brexit negotiations and hard talks that are currently occurring. From a technical perspective, we could expect to see 147.500 if we can maintain a break below the 150.000 key level. This monthly region will hold the key whether we break and start a reversal or rebound and continue our overall direction of steep valley pulls back and higher high peeks.