Monitoring Yen's Rally Against Sterling
Solid ECN – The Japanese yen is making a comeback against the pound sterling from 192.9 and is increasing its pace toward the 23.6% Fibonacci level.
The pair trades in the bullish flag depicted in red, as shown on the daily chart. The current downward momentum occurs while the RSI indicator closes on the 50 levels and the Awesome Oscillator signals divergence. This could be interpreted as a trend reversal or the beginning of a new consolidation phase, which appears stronger.
From a technical standpoint, the primary trend is bullish. Still, due to the divergence signal, the consolidation phase might extend to the 23.6% Fibonacci support, followed by the lower band of the bearish flag in blue.
Therefore, we suggest monitoring the aforementioned levels closely for a hammer stick pattern since these levels provide a decent price point for joining the bull market.