FxWirePro: GBP/JPY selling momentum intensifies as bears resume in non-directional trend but major trend remains intact

From the last three weeks, the pair hasn’t been moving anywhere beyond 128.498 northwards nor even 126.298 on southwards.

Bears in major trend have been drifting in sideways, both leading and lagging indicators to substantiate.

But for now, we foresee more dips are underway upon breach below support at 126.298.

But prior to that it has rejected the resistances at 128.167 levels to form a gravestone doji pattern and pushed towards DMA curves on 4H chart.

Bears have managed to slide below DMAs after this gravestone pattern to support major downtrend, for now, the drag towards 125.289 seems most likely, the continuation of major trend has been upheld at this juncture.

On a broader perspective, the bears attempting to break support at 126.451 despite hammer formation.

We are not isolating this signal on intraday charts; let’s have a glance on both leading and lagging oscillators on monthly terms that indicate selling pressures.

The current prices have consistently remained below EMAs from the last couple of months, so the downtrend would likely continue in the medium run.

Selling momentum is intensified as we can make out from the leading oscillators converging downwards along with the dipping prices.

While RSI (14) converging to the dipping prices even below 40 levels that signal the strength in selling interests.

Stochastic oscillators have reached oversold territory but no convincing %k crossover is seen, instead intensified selling momentum is observed.

MACD on monthly terms evidences bearish convergence below zero levels that signify the sentiments of ongoing downtrend extension.

Trade tips:

Well, as the momentum in downswings is intensified and trend indicators do not signal any dramatic reversal movements, considering the prevailing trend at spot ref: 126.778 it is wise to deploy digital tunnel spread which is the binary edition of debit put spreads. Thus, captures rallies to add longs in binary puts near 127.000.