GBPJPY resuming downtrend?

Good Morning Dynamic Traders

Hope you've all had a great weekend and ready for a new week of trading. The market is there for the taking, we just have to see what's on offer.

I want to look at the GBPJPY this morning. Taking a look at the weekly chart we can see that although price has recently been climbing up, the larger trend is in fact down. We have a DT formation, which in a downtrend would suggest a strong continuation. Coupled with that we also have the MACD divergence - so confluences seem to be stacking up in favour of the larger trend. Be sure to use your complete Dynamic Toolkit when analysing as you will uncover further confluences to add to your edge.

















Now looking at the Daily chart we can see price was oscillating since May, finding comfort around the VI. Both the up TL and the low point from July have now been breached. As the current trend is up, SM traders would have been waiting for that BOB of the July low and applied ESLT. As you can see price today has tagged the RN at 140.00 and bounced right back up, suggesting sellers are hesitating at this point and buyers are stepping in.

















What will price do now? It may very well ignore the RN and continue south, or find it to difficult to break and consolidate for a while or even head back north to it's current trend. We can weigh up our odds and be ready to take appropriate action, but always be neutral as price could do anything.

Let's see how the week unravels for this pair. As always please carry out your own analysis.

Here's to great trading!

Sonia Molina