We see an injection of volatility in the already heavy looking GBP/JPY pair.
The washout in today’s trading has expanded the Bollinger® bandwidth indicator for four consecutive hours beyond the maximum width seen in a week of trading. Moreover, the same 1hr charts show recent close prices printing below the 50-period EMA, a bearish condition that should it persist, would help keep the SAR indicator trailing above the price.
A change of direction would be quickly noticed by the SAR, implying GBP/JPY shorts are taking profit. Risks exist the volatility and the plummeting price action extend to higher time frames.
SAR still trailing the falling GBP/JPY rate
(Market News Provided by FXstreet)