GBPJPY's Pennant Needs to be Completed Before a Bearish Reversal
The GBPJPY is currently forming a Pennant pattern, which presupposes diminishing volatility. Such conditions are typically observed whenever the market is ranging, potentially before the price gets ready to develop a new upswing/downswing.
The current upswing could reach the Test Area in green before a major bearish reversal takes place. Bears can look for an opportunity to sell near the Area's upper boundary at 152.00 with the intention to catch the subsequent downswing towards the Target Area.
Keep in mind that the price action is currently probing the 100-day MA, which could prove to be an impregnable resistance even before the GBPJPY manages to reach 152.000. Moreover, the 200-day MA (in purple) is currently converging with the lower boundary of the Test Area, so there are multiple places where a bearish reversal could occur.
The current upswing could reach the Test Area in green before a major bearish reversal takes place. Bears can look for an opportunity to sell near the Area's upper boundary at 152.00 with the intention to catch the subsequent downswing towards the Target Area.
Keep in mind that the price action is currently probing the 100-day MA, which could prove to be an impregnable resistance even before the GBPJPY manages to reach 152.000. Moreover, the 200-day MA (in purple) is currently converging with the lower boundary of the Test Area, so there are multiple places where a bearish reversal could occur.
