GBP/JPY Price Analysis: Double-top about to reach its target

The British pound weakens vs. the Japanese yen and drops 0.69%.
The GBP/JPY daily chart illustrates the double-tops stays in play, and the exchange rate is about to reach its target.
In the near term, the GBP/JPY might correct to 161.61 before nose-diving towards the double-top target at 159.50.

Christian Borjon Valencia FXStreet

The GBP/JPY sinks for the third straight day, and the cross-currency pair accelerates towards the double-top price target at 159.50. At 161.25, the GBP/JPY reflects a dampened market mood, spurred by Fed policymakers led by Minnesota’s Fed President Kashkari, who pushed back against a Fed “dovish” tilt and opened the door for further tightening. That, alongside geopolitical tensions between the US and China, arising as the US House Speaker Nancy Pelosi could visit Taiwan.

GBP/JPY Price Analysis: Technical outlook

The GBP/JPY daily chart depicts the pair as neutral-to-downward biased. Break below 163.00, the double-top “neckline” exacerbated the fall, and on its way down, the GBP/JPY cleared the 20, 50, and 100-day EMAs. Traders should notice that the Relative Strength Index (RSI) is in negative territory and with enough room to spare before reaching oversold conditions. Therefore, a move towards the double-top target at 159.50 is on the cards, but firstly, GBP/JPY sellers need to clear the July 6 swing low at 160.38.

GBP/JPY 1-hour chart

In the near term, the GBP/JPY hourly chart illustrates the pair as neutral-to-downward biased, but risks are skewed to the upside. Be aware that the Relative Strength Index (RSI) at 36.72 aims to cross over the 7-hour RSI’s SMA, which could lift the pair, at least towards the confluence of the daily pivot and the 20-hour EMA at 161.61. Nevertheless, failure to do so, the GBP/JPY could dip below the 161.00 mark, towards the 160.00 figure, ahead of the double-top target at 159.50.

GBP/JPY Key Technical Levels

GBP/JPY

Overview
Today last price	161.24
Today Daily Change	-1.14
Today Daily Change %	-0.70
Today daily open	162.38

Trends
Daily SMA20	163.96
Daily SMA50	164.04
Daily SMA100	162.58
Daily SMA200	158.34

Levels
Previous Daily High	163.91
Previous Daily Low	161.54
Previous Weekly High	166.34
Previous Weekly Low	161.54
Previous Monthly High	166.34
Previous Monthly Low	160.4
Daily Fibonacci 38.2%	162.45
Daily Fibonacci 61.8%	163
Daily Pivot Point S1	161.31
Daily Pivot Point S2	160.24
Daily Pivot Point S3	158.94
Daily Pivot Point R1	163.68
Daily Pivot Point R2	164.98
Daily Pivot Point R3	166.05

Author

Christian Borjon Valencia

FXStreet

Christian Borjon began his career as a retail trader in 2010, mainly focused on technical analysis and strategies around it. He started as a swing trader, as he used to work in another industry unrelated to the financial markets.

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