Trade of the Day: GBP/JPY
By: Dima Chernovolov
GBP/JPY continues to fall inside the 4-hour Falling Wedge chart pattern which was previously identified by Autochartist. Autochartist rates the quality of this Falling Wedge at the 5-bar level – which is the result of the below-average Initial Trend (4 bars), higher Uniformity and Clarity (6 bars) GBP/JPY is expected to fall further inside this Falling Wedge – in line with the earlier downward reversal from the key resistance level shown below.
As can be seen from the daily GBP/JPY chart below, the pair recently reversed down with the daily Japanese candlestick reversal pattern Shooting Star from the strong resistance level 141.30 (former double bottom from February). The proximity of this resistance level increases the probability GBP/JPY will continue to fall inside this chart pattern.