GBP/JPY Price Analysis: Retraces from weekly highs, meandering around YTD highs

The GBP/JPY tumbled 0.17% on Tuesday due to waning GBP demand.
The cross-currency daily chart suggests the GBP/JPY might print a leg-down before resuming its uptrend.
Short term, the GBP/JPY is upward biased, and if it cleats 169.50, a test of 170.00 is on the cards.

Christian Borjon Valencia FXStreet

The GBP/JPY surpasses the previous YTD high of around 168.73 but retraces from daily highs at about 169.80, below its opening price by a minimal 0.19%, despite a risk-on impulse. At the time of writing, the GBP/JPY is trading at 168.89.

Sentiment remains upbeat, with US equities registering gains between 0.90% - 1.14%, while the greenback registers slight losses of 0.03%, as shown by the US Dollar Index. In the FX space, the Japanese yen is the laggard, while the British pound is still appreciating after UK’s U-turn on Liz Truss’s minimal budget.

GBP/JPY Price Forecast

Given the backdrop, the GBP/JPY is gaining 1.63% so far in the week. The GBP/JPY daily chart portrays the pair as upward biased, but Tuesday’s price action formed a hanging-man candle pattern, meaning that additional downward pressure is expected. Therefore, GBP/JPY key support lies at 167.58, which, once cleared, could send the GBP/JPY sliding toward the October 17 daily low at 166.43.

The GBP/JPY hourly chart is also upward biased, though price action fluctuates above/below the 20-EMA with no clear trend. However, below the exchange rate, the rest of the EMAs suggest that the upside is warranted, but firstly it will need to clear some hurdles on its way north.

Hence the GBP/JPY first resistance would be the 169.00 figure, followed by the R1 pivot at 169.97, ahead of the 170.00 mark.

GBP/JPY Key Technical Levels

GBP/JPY

Overview
Today last price	169.02
Today Daily Change	-0.24
Today Daily Change %	-0.14
Today daily open	169.26

Trends
Daily SMA20	161.67
Daily SMA50	162.47
Daily SMA100	163.37
Daily SMA200	160.89

Levels
Previous Daily High	170.1
Previous Daily Low	166.05
Previous Weekly High	167.29
Previous Weekly Low	159.73
Previous Monthly High	167.22
Previous Monthly Low	148.8
Daily Fibonacci 38.2%	168.55
Daily Fibonacci 61.8%	167.6
Daily Pivot Point S1	166.84
Daily Pivot Point S2	164.42
Daily Pivot Point S3	162.8
Daily Pivot Point R1	170.88
Daily Pivot Point R2	172.51
Daily Pivot Point R3	174.93

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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