GBPJPY Needs To Make a Decision Soon [Rising Wedge]
Updated
There are multiple very interesting things going on here from a technical analysis perspective.
First of all, we find GBPJPY in a rising wedge. The support lines are getting closer together, and the price is perfectly staying within the lines. Soon, GBPJPY will break out of those lines which can cause a big disruption to the price. Many people are watching these patterns right now. Overall, this is a bearish pattern and the price is about the break out of the bottom support line. This is a very negative sign for the price.
Secondly, GBPJPY is near a horizontal area of resistance. The price has respected this area already before, and shown that it was very difficult to break through this area. It even acted as a support zone earlier on due to an S/R flip. This zone of resistance is another bearish signal that shows that it will be difficult for the price to get higher.
Lastly, we find confluence. Because these two signals show us the same direction, the signal is becoming stronger. That's the reason why I suggest a short trade here with a stop loss tightly above the zone of resistance. In case we invalidate this idea, we should leave the trade as soon as possible.
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Disclaimer!
This post does not provide financial advice. It is for educational purposes only!
First of all, we find GBPJPY in a rising wedge. The support lines are getting closer together, and the price is perfectly staying within the lines. Soon, GBPJPY will break out of those lines which can cause a big disruption to the price. Many people are watching these patterns right now. Overall, this is a bearish pattern and the price is about the break out of the bottom support line. This is a very negative sign for the price.
Secondly, GBPJPY is near a horizontal area of resistance. The price has respected this area already before, and shown that it was very difficult to break through this area. It even acted as a support zone earlier on due to an S/R flip. This zone of resistance is another bearish signal that shows that it will be difficult for the price to get higher.
Lastly, we find confluence. Because these two signals show us the same direction, the signal is becoming stronger. That's the reason why I suggest a short trade here with a stop loss tightly above the zone of resistance. In case we invalidate this idea, we should leave the trade as soon as possible.
Follow me for consistent high quality updates, with clear explanations and charts.
Please like this post to support me.
- Trading Guru
--------------------------------------------------------------
Disclaimer!
This post does not provide financial advice. It is for educational purposes only!
Trade active
The trade has started. The price has indeed dropped through the bottom support line of the rising wedge. After a small retracement, then finally it has been rejected by the horizontal resistance zone. Nice to see that the confluence here is really working out, as the initial break through the falling wedge was not as strong as I initially expected.
If you hadn't entered the trade already, this is a great moment to do so. Make sure you place your stop losses slightly above the zone of horizontal resistance to automatically leave the trade when our pattern gets invalidated.
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