GBP/JPY Price Analysis: Failure to reclaim 158.00 exposed the cross-currency to downward pressure
- The British pound advances some 0.18% vs. the Japanese yen.
- GBP/JPY failure to reclaim above 158.22 exposes the pair to downward pressure unless GBP bulls keep the pair above 156.00.
As the end of the first trading week of 2022 approaches, the British pound trimmed some of Thursday’s losses and reclaimed the 157.00 figure. At the time of writing, the GBP/JPY is trading at 157.12 during the North American session.
On Friday, the GBP/JPY was subdued amid the lack of UK and Japanese economic data in the docket. During the overnight session for North American traders, the GBP/JPY was range-bound in the 156.70-157.10 range, trendless and seesawing around the 50-hour simple moving average (SMA).
GBP/JPY Price Forecast: Technical outlook
The GBP/JPY is still bullish biased, though failed short of breaking above the 158.00 figure, once broken in October of 2021, when the GBP/JPY printed the yearly high at 158.22. However, Friday’s recovery leaves some doubts on the table. The cycle high reached on January 5 at 157.76, is lower than the abovementioned, so any strong twist in the market mood would exert downward pressure on the GBP/JPY.
To the upside, the GBP/JPY first resistance level is the January 5 daily high at 157.76. A breach of the latter would expose October 20, 2021, cycle high at 158.22, followed by the 160.00 figure and then May’s 2016 monthly highs around 163.86.
On the flip side, the cross-currency first support is the 157.00 figure. A clear break of the figure opens the door for a challenge of the January 6 daily low at 156.09, followed by the January 3 daily low at 154.89, and then December 28, 2021, pivot low at 154.00.
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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.
