The GBPJPY pair was moving in a strong downward trend over the past month. From a maximum of 142.70 on 01.09 it fell by 970p, setting last Tuesday September’s minimum at 133.00.
Throughout the entire period of the falls, the MACD oscillator showed increasingly smaller values, until last Friday. The last day of the past week was the first day the indicator entered the growth phase.
In the H4 chart there is an upward divergence suggesting that the already three day adjustment has a chance to continue. When planning an order, it should be taken into account that the GBPJPY pair is a highly volatile instrument, often reaching over 200p per day. Therefore, it is worth considering reducing the volume of transactions by half.
It should also be borne in mind that talks are underway between the EU and the UK on the rules of trade between these separate economic zones as they will become after 01.01.2021. News from London and Brussels may have a very large and unexpected impact on this currency pair.
In the case of a growth scenario, buyers’ target may be the supply zone starting at 135.30.
Breaking the minimum of September 133.00 and the return of MACD to the downward phase may be a signal that the sellers took the initiative and the growth scenario was negated.
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