GBPJPY Analysis, May 27, 2025
GBPJPY on the M15 time frame In the green zone, there is a reversal candlestick pattern called ?bearish engulfing? on a micro scale. The large bearish candle completely ?engulfs? the previous bullish candle, giving a strong signal that buyers have been defeated in the short-term battle. In this context, the pattern appears right in the resistance area confirmed by the MA, thus strengthening the signal from a technical confluence point of view. In addition, after the engulfing pattern was formed, the price not only moved down but also formed new lower highs and lower lows, indicating the start of a broader bearish structure. This marks the transition of the market structure from bullish to bearish, an important signal in trend following and breakout strategies.
Based on all the elements of the technical analysis above, the most rational recommendation is to look for opportunities for short positions. The first profit target can be placed in the red support area around the price of 192.29, with the potential for an extended target if this level is broken. For optimal risk management, it is recommended to use a risk-to-reward ratio of at least 1:2.