After examining the weekly chart, we believe GBP/JPY to be in an overall bearish trend. We have been waiting for a sign that this latest bullish pullback, in place since 23rd September, was over and that we may get the next bearish impulse.
Yesterday, we may have had that sign. Price broke to the downside from a daily rising wedge pattern, which can often form as part of a continuation sequence. As a result, we are now expecting the next bearish impulse down, to retest at least to the base of the wedge at 133.57. For a riskier entry we could enter now, but for further confirmation we are waiting for the next lower high to form, and enter after that.
If a new higher high is formed, this analysis will become invalid.
Yesterday, we may have had that sign. Price broke to the downside from a daily rising wedge pattern, which can often form as part of a continuation sequence. As a result, we are now expecting the next bearish impulse down, to retest at least to the base of the wedge at 133.57. For a riskier entry we could enter now, but for further confirmation we are waiting for the next lower high to form, and enter after that.
If a new higher high is formed, this analysis will become invalid.