GBP/JPY Price Analysis: Bounces off lows, still in the red just above 136.00 mark

GBP/JPY witnessed some fresh selling on Thursday and dropped back closer to two-week lows.
The lack of any strong follow-through selling warrants some caution for aggressive bearish traders.

Haresh Menghani FXStreet

The GBP/JPY cross continued losing ground through the early North American session and slipped below the 136.00 mark, back closer to two-week lows set on Wednesday. Bulls, however, showed some resilience at lower levels and assisted the cross to quickly recover around 50 pips from the daily swing lows near the 135.75 region.

Looking at the technical picture, the overnight strong intraday rally of over 150 pips struggled to find acceptance above the 200-period on the 4-hourly chart. A subsequent rejection slide from three-week-old ascending trend-line support breakpoint favours bearish traders and points to additional weakness.

That said, the lack of any strong follow-through selling warrants some caution for aggressive bearish traders. Moreover, technical indicators on the daily chart are yet to confirm the bearish bias. This makes it prudent to wait for a slide below the overnight swing lows, around the 135.65 region, before placing fresh bearish bets.

The GBP/JPY cross might then turn vulnerable to accelerate the fall further towards challenging the key 135.00 psychological mark, or monthly swing lows touched on October 2. The downward trajectory might then turn the cross vulnerable to break below the 134.00 mark and slide further towards September daily closing lows, around the 133.65 region.

On the flip side, any meaningful recovery attempt now seems to confront stiff resistance near the 136.80-85 region. This is closely followed by the 137.00 mark, above which a bout of a short-covering move has the potential to lift the GBP/JPY cross back towards the 137.80-85 heavy supply zone.

GBP/JPY 4-hourly chart

Technical levels to watch

GBP/JPY

Overview
Today last price	136.27
Today Daily Change	-0.59
Today Daily Change %	-0.43
Today daily open	136.86

Trends
Daily SMA20	135.89
Daily SMA50	137.77
Daily SMA100	136.49
Daily SMA200	136.53

Levels
Previous Daily High	137.33
Previous Daily Low	135.67
Previous Weekly High	137.84
Previous Weekly Low	135.91
Previous Monthly High	142.72
Previous Monthly Low	133.05
Daily Fibonacci 38.2%	136.7
Daily Fibonacci 61.8%	136.3
Daily Pivot Point S1	135.91
Daily Pivot Point S2	134.96
Daily Pivot Point S3	134.24
Daily Pivot Point R1	137.57
Daily Pivot Point R2	138.28
Daily Pivot Point R3	139.24

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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