Resembling bearish engulfing and doji pattern candles have formed at 151.140 and 151.099 levels respectively (refer daily charts).
Consequently, the bears have managed to slide below 7DMAs, you can easily make out 3-consecutive days of bearish streaks ever since the occurrence of long legged doji.
For now, the selling sentiment backed by both leading indicators on this timeframe.
On the flip side, although GBPJPY consolidation phase has retraced upto 38.2% Fibonacci levels, rallies now seem to have been halted at 150.969 levels in the recent past, we see no traces of bearish indications on major trend.
Leading oscillator (stochastic curves) are approaching overbought trajectory.
RSI has been showing constant upward convergence to signify the strength in rallies even above 75 levels.
To substantiate this bullish stance, MACD, on the other hand, forms bullish crossover to signal the extension of the bullish trend on both time frames.
Well on a broader perspective, bulls have managed to retrace above 38.2% Fibonacci levels from the lows of 123.041 levels in October 2016.
Overall, the minor trend may gain more upside traction upon sustenance above 38.2% Fibos despite minor hic-ups. Thus, on speculative grounds, we advocate buying tunnel spread using upper strikes at 150.5420 and lower strikes at 148.2500.
Alternatively, on hedging grounds, encourage longs in futures contracts of mid-month tenors in order to arrest upside risks.
Currency Strength Index: FxWirePro's hourly GBP spot index is flashing at -41 levels (bearish), while hourly JPY spot index was at shy above -46 (bearish) at 07:03 GMT, these indies values are also in sync with our above technical rationale. For more details on the index, please refer below weblink:
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