has rallied sharply due to a combination of market manipulation from the Bank of Japan as well as a short covering
rally which lifted the Pound Sterling. This currency pair
has formed a rising wedge
formation as visible in the H4 chart. Price action is currently centered at ascending support
levels with a pending breakdown
of the chart formation imminent. We call this currency pair lower from current levels amid profit taking
has formed a negative divergence
and does not confirm the higher highs set by this currency pair. Momentum
has started to decelerate which confirms the pending breakdown. RSI
has formed a negative divergence as well and has been trading in extreme overbought
territory for an extended period of time.
We recommend a short position
at 153.00 with a potential second entry level at 154.00. We also recommend trader to place a stop buy
order at 153.50 in order to hedge
their open position.
Traders who wish to exit this trade at a loss are advised to palace their stop loss
level at 153.50. We will not utilize a stop loss level and execute the trade as recommended. Place your take profit
level at 148.00.Here is why we call the GBPJPY currency pair lower
Open your PaxForex Trading Recommendations now and add this trade to your portfolio.
- GBPJPY has formed a rising wedge formation and has overextended its rally without a correction
- Price action is centered around support and is pending a breakdown
- MACD has formed a negative divergence and momentum started to fade
- RSI has formed a negative divergence RSI has traded in extreme overbought territory for an extended period of time
- Profit taking