GBPJPY runs into sellers around 144.44 for the third day in a row
British Pound/Japanese Yen (GBPJPY) Technical Analysis Report for Jan 24, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, GBPJPY finished the week -0.3% lower at 142.86 after losing 86 pips (-0.6%) today. Trading 73 pips higher after the open, GBP/JPY was unable to hold its gains as the bears took control ending the day below its opening price. Closing below Thursday's low at 143.21, the market confirmed its breakout through the previous session low after trading up to 49 pips below it intraday.
Daily Candlestick Chart (GBPJPY as at Jan 24, 2020):
Friday's trading range has been 172 pips (1.2%), that's above the last trading month's daily average range of 127 pips. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently lower than usual for GBPJPY.
In a volatile session, prices traded above the prior day's high as well as below the previous day's low, forming a bearish Outside Bar.
The Geppy closed back below the 20-day moving average at 143.13 for the first time since January 13th. The forex pair ran into sellers again today around 144.44 for the third trading day in a row after having found sellers at 144.43 in the prior session and at 144.61 two days ago. The last time this happened on December 9, 2019, GBPJPY actually gained 0.27% on the following trading day.
While the FX pair is currently in a short-term downtrend, this might just be a correction, as both the medium and long-term trends are still bullish.
With prices trading close to this year's low at 140.83, downside momentum could accelerate should the currency break out to new lows for the year.
Among the 11 market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bearish Outside Bar" stand out. Its common bearish interpretation has been confirmed for GBP/JPY. Out of 136 times, GBPJPY closed lower 57.35% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the short side has been after 10 trading days, showing a win rate of 55.15% with an average market move of -0.17%.
With five out of the seven Major FX Pairs closing lower today, the ones that stand out on the negative side are GBPUSD losing -0.41% and AUDUSD closing -0.34% lower. On the flipside the best performers have been USDCHF closing 0.23% higher and USDCAD gaining 0.14%. Looking at the other Minor FX Pairs and Crosses, the winners of the day have been USDNOK surging 0.57% and USDPLN closing 0.53% higher. The worst performers of the day have been AUDJPY tanking -0.53% and EURJPY closing -0.5% lower. Read more