GBP/JPY Price Analysis: Breaks through a three-day-old ascending channel hurdle

GBP/JPY gained some positive traction for the third consecutive session on Wednesday.
The momentum pushed the cross further beyond a three-day-old ascending channel.
The lack of follow-through, overbought RSI on the 1-hourly chart warrant some caution.

Haresh Menghani FXStreet

The GBP/JPY cross edged higher for the third consecutive day and jumped to near one-week tops, around the 136.45 region during the mid-European session on Wednesday.

The latest leg of a sudden spike in the last hour could be attributed to some technical buying on a sustained move beyond the top end a three-day-old descending channel. This comes on the back of the early resilience below 100-hour SMA and supports prospects for further intraday gains.

However, the lack of any strong follow-through buying questions the reliability of the breakout. This coupled with the fact that RSI (14) on the 1-hourly chart has just moved above the 70 mark further warrants some caution before placing any aggressive bullish bets, at least for now.

Hence, it will be prudent to wait for some follow-through buying beyond last week's swing high, around the 136.50-60 region, above which bulls are likely to aim to reclaim the 137.00 mark. The positive momentum could further get extended towards the 137.20-25 horizontal resistance.

On the flip side, the 136.00 round-figure mark now seems to protect the immediate downside and is closely followed by support near the 135.70 region (100-hour SMA). Failure to defend the mentioned support levels will negate any near-term bullish bias and prompt some fresh selling.

The cross might then accelerate the slide further towards the lower boundary of the mentioned channel, currently near mid-135.00s. Some follow-through selling will be seen as a fresh trigger for bearish traders and set the stage for a fall towards challenging the key 135.00 psychological mark.

GBP/JPY 1-hourly chart

Technical levels to watch

GBP/JPY

Overview
Today last price	136.26
Today Daily Change	0.36
Today Daily Change %	0.26
Today daily open	135.9

Trends
Daily SMA20	135.08
Daily SMA50	134.46
Daily SMA100	133.47
Daily SMA200	137.58

Levels
Previous Daily High	136.13
Previous Daily Low	135.32
Previous Weekly High	136.63
Previous Weekly Low	134.35
Previous Monthly High	139.74
Previous Monthly Low	131.77
Daily Fibonacci 38.2%	135.82
Daily Fibonacci 61.8%	135.63
Daily Pivot Point S1	135.44
Daily Pivot Point S2	134.98
Daily Pivot Point S3	134.64
Daily Pivot Point R1	136.25
Daily Pivot Point R2	136.59
Daily Pivot Point R3	137.06

Author

Haresh Menghani

FXStreet

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

GBP/USD climbs to two-day highs past 1.3200

GBP/USD picks up extra pace and surpasses the 1.3200 threshold on Thursday. That said, Cable manages to shrug off initial weakness and regain balance on the back of the fresh selling pressure hurting the Greenback.

EUR/USD stays consolidative around 1.1370

EUR/USD regains momentum and trades with modest gains around 1.1370 ahead of the opening bell in Asia. The pair sets aside three daily declines in a row and picks up pace on the back of the lacklustre performance of the US Dollar, particularly after US data failed to reinforce Fed rate hike bets.

Gold declines below $4,050 as US PCE inflation supports Fed hike bets

Gold price declines to around $4,020 during the early Asian session on Friday. The precious metal extends the decline as traders have ramped up bets of a US rate hike. The Michigan Consumer Sentiment Index report is due later on Friday. Also, Federal Reserve New York President John Williams and Fed Bank of Minneapolis President Neel Kashkari are set to speak.

Uniswap adds $150M in Spark stablecoin liquidity, launches no-code token auction tool

Uniswap received $150 million in stablecoin liquidity from Spark, with the assets set to transition to DualPool, a new custom liquidity hook, according to an announcement on Thursday. Under the new setup, liquidity providers will be able to earn swap fees while their underlying assets continue generating yield, eliminating the need to choose between the two.

Micron prints perfect, and now the chart has to answer

Memory’s biggest name just delivered the cleanest quarter of its life, and the most interesting thing about it is that the stock isn’t sure what to do with it. Micron closed out fiscal Q3 with revenue of $41.5 billion, up 346% on the year, a fifth straight record. Gross margin came in at 84.9%, up from 39% the same quarter a year ago. Earnings landed at $25.11 against a Street sitting near $20.49.

Regime change: Inside Kevin Warsh's first move to make the Fed unreadable on purpose

The rate did not move. That was the least interesting thing about Kevin Warsh's first meeting in charge of the Fed. The FOMC held its benchmark at 3.50%-3.75% for the fourth straight meeting, exactly as priced, and then the new chair used his first press conference to dismantle the machinery the market has leaned on for a decade.