Market Spotlight: GBPJPY Head & Shoulders

GBPJPY Pattern Developing Price action in GBPJPY is starting to look interesting for bears. The latest failure at the 153.39 level holds the potential to be a right shoulder of a large head and shoulder pattern, suggesting room for a move lower here. With almost 70% of the retail market currently long, there is plenty of scope for downside momentum to build. RSI is turning lower here and MACD has crossed bearish also, further highlighting the potential shift in sentiment. While below the 151.36 level, bears can look for 149.39 initially with room for a deeper fall thereafter.With UK infection rates starting to climb higher again, as well as fears over the new Lambda variant, GBP has come under pressure here while JPY is deriving safe-haven inflow. With this theme likely to continue to develop, there are clear downside risks for the pair.Key Data to WatchThe slew of UK data scheduled for Wednesday will be the main data focus. If CPI shows any weakness this will likely send GBP much lower near term, blunting BOE tightening expectations. Away from Wednesday’s release, COVID headlines and movement in risk assets will be key also with JPY likely to gather further strength from any negative COVID news.

from Tickmill Expert Blog - Forex Traders Blog https://www.tickmill.com/blog/market-spotlight-gbpjpy-head-and-shoulders"
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