GBP/JPY Price Analysis: Rallies after hitting the double-top target, below 159.50

The GBP/JPY rallied after hitting a three-month fresh low at 159.44.
A risk-off impulse exacerbated GBP/JPY fall towards the double-top target.
The GBP/JPY is neutral biased, but a break above 162.00 puts the 163.00 targets in place; otherwise, a drop to 161.00 is on the cards.

Christian Borjon Valencia FXStreet

The GBP/JPY rallied after touching the double-top target and the daily low at around 159.44, then hitting a daily high at 162.00 before retracing to current price levels. At the time of writing, the GBP/JPY is trading at 161.99 as the Asian session begins.

Investor’s sentiment shifted sour as tensions arose between China and the US. The visit of US House Rep. Nancy Pelosi was promptly condemned by China, saying it “has a severe impact on the political foundation of China-US relations, and seriously infringes upon China’s sovereignty and territorial integrity.” Besides that, traders reconsidered the so-called Fed “dovish” pivot, with policymakers like Daly, Evans, and Mester reiterating Fed’s commitment to tackle inflation.

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

GBP/JPY Price Analysis: Technical outlook

The GBP/JPY daily chart illustrates the pair as neutral biased once the double-top target was achieved when the pair hit 159.50. After that, the cross-currency rallied sharply, 250 pips, towards the daily highs, but short of August 1, open at 162.27, forming a hammer with bullish implications.

Therefore, the GBP/JPY first resistance would be 162.00. Break above will expose the August 1 high at 162.49, followed by the 100-day EMA at 162.73, and then the 163.00 mark.

GBP/JPY Key Technical Levels

GBP/JPY

Overview
Today last price	161.99
Today Daily Change	0.77
Today Daily Change %	0.48
Today daily open	161.22

Trends
Daily SMA20	163.81
Daily SMA50	164.05
Daily SMA100	162.66
Daily SMA200	158.37

Levels
Previous Daily High	162.5
Previous Daily Low	161.04
Previous Weekly High	166.34
Previous Weekly Low	161.54
Previous Monthly High	166.34
Previous Monthly Low	160.4
Daily Fibonacci 38.2%	161.6
Daily Fibonacci 61.8%	161.95
Daily Pivot Point S1	160.68
Daily Pivot Point S2	160.13
Daily Pivot Point S3	159.21
Daily Pivot Point R1	162.14
Daily Pivot Point R2	163.05
Daily Pivot Point R3	163.6

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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