GBP/JPY Price Analysis: Bulls pause after reaching month-high, outlook still bright
|- GBP/JPY trades at 183.75 with slight losses, stopping bulls after a 2% uptick in the previous three days.
- The bulls presented battled and trimmed losses, which took the cross below the 100-day SMA.
- The daily chart uncovers flat RSI and MACD, representing a halt in the buying momentum.
- The four-hour chart shows little change in overbought conditions.
In Monday's session, the GBP/JPY softened modestly to 183.75. Despite pulling back slightly after a vigorous surge of more than 2% over recent days, the bulls seem to be catching their breath. Neutral to bullish on the daily chart, yet nearing overbought territory in the four-hour chart, the pair remains poised for additional corrections.
According to the technical indicators on the daily chart, the landscape appears somewhat idyllic for the bulls in the long term. The Moving Average Convergence Divergence (MACD) is fairly flat with green bars, indicating a neutral sentiment but with a slight bullish bias. Meanwhile, the Relative Strength Index (RSI) settles in the positive territory, preserving a tight line and suggesting a pause in recent buying momentum. Nonetheless, the pair remains well above the 20,100,200-day Simple Moving Averages (SMAs), implying that the bulls still maintain control in the wider perspective. This bullish dominance is further reinforced by the recent gains, with the pair having advanced more than 2% in the recent three days, thus indicating that buying momentum continues to hold sway over selling momentum.
Shifting to the shorter-term four-hour chart, the indicators paint a similar picture of bull's dominance, albeit with a hint of a possible slowdown. The Moving Average Convergence Divergence (MACD) portrays flat green bars, indicating a continuation of bullish sentiment, yet with a possible pause. The Relative Strength Index (RSI) remains flat within the positive territory, still near overbought conditions. Such positioning could suggest that the bulls are taking a breather, allowing for potential consolidation before the next leg upward. Thus, on a shorter time frame, the prevailing buying momentum appears to be taking a slight recess, providing a chance for sell-side action to develop, but the broader bullish bias remains intact.
GBP/JPY technical levels
GBP/JPY daily chart
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.