GBP/JPY Price Analysis: Experiences a pullback as double top looms

GBP/JPY witnesses a decline of over 0.20%, with the Japanese Yen gaining strength against major currencies.
Despite the pair's overall bullish trend, recent price actions have formed a 'double top' pattern, thought further confirmation needed, with prices breaking below 184.46.
Conversely, a move above the November 28 daily high of 187.87 could set the stage for the pair to test the year-to-date high at 188.80.

Christian Borjon Valencia FXStreet

The GBP/JPY retreats on Tuesday by more than 0.20%, as the Japanese Yen (JPY) appreciated further against most G8 FX currencies. Market participants estimate that central banks in developed countries would cut rates, boosting the appetite for the Yen's safe-haven status and Gold. Therefore, the pair is trading at 187.24 after hitting a daily high of 187.87.

Even though the GBP/JPY remains bullish, price action during the last couple of days, has formed a ‘double top’ chart pattern, implying that lower prices are coming. Nevertheless to confirm the pattern, the cross must drop below the November 21 swing low at 184.46, but sellers must breach support levels on its way to the latter.

The first support would be the Tenkan-Sen at 186.55, followed by the Senkou-Span A at 185.63. A decisive break, the pair would dive to the Kijun-Sen at 184.71, before testing the latest cycle low. Once done, the ‘double top’ chart pattern targets the 180.50 area.

On the flip side, if GBP/JPY buyers reclaim the November 28 daily high at 187.87, that could open the door to challenge the year-to-date (YTD) high at 188.80.

GBP/JPY Price Analysis – Daily Chart

GBP/JPY Technical Levels

GBP/JPY

Overview
Today last price	187.21
Today Daily Change	-0.50
Today Daily Change %	-0.27
Today daily open	187.71

Trends
Daily SMA20	185.98
Daily SMA50	183.61
Daily SMA100	183.39
Daily SMA200	176.72

Levels
Previous Daily High	188.53
Previous Daily Low	187.61
Previous Weekly High	188.67
Previous Weekly Low	184.47
Previous Monthly High	184.33
Previous Monthly Low	178.08
Daily Fibonacci 38.2%	187.96
Daily Fibonacci 61.8%	188.18
Daily Pivot Point S1	187.37
Daily Pivot Point S2	187.03
Daily Pivot Point S3	186.45
Daily Pivot Point R1	188.29
Daily Pivot Point R2	188.87
Daily Pivot Point R3	189.21

Author

Christian Borjon Valencia

FXStreet

Markets analyst, news editor, and trading instructor with over 14 years of experience across FX, commodities, US equity indices, and global macro markets.

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