GBP/JPY Price Analysis: Retraces towards 156.00 as bulls take a breather before aiming towards 157.00

The GBP/JPY eyes to end the week flat in the North American session. As the weekend approaches, the GBP/JPY trades at 156.40 at press time.

Friday’s session keeps the week’s narrative unchanged. Geopolitical headlines courtesy of the Russia/Ukraine crisis dominate newswires, while central bank speaking and macroeconomic data took the backseat as tensions in eastern Europe arose. That affected the market sentiment, staying sour ahead of the weekend. In the FX space, safe-haven peers like the Japanese yen, the US dollar, and the Swiss franc, benefitted from those factors.

GBP/JPY Price Forecast: Technical outlook

Weekly chart

The GBP/JPY is neutral biased, as this week’s failure to record a new weekly high formed a “bearish-harami” candlestick chart pattern, also known as an inside bar, suggesting that the GBP/JPY aims downwards.

Also, a triple-top formation looms, as the GBP/JPY unsuccessfully tested the 158.00, which opened the door for two retracements. In the first one, the GBP/JPY fell to 148.97, and the second one to 152.90.

A weekly close under 155.00 would accelerate the downward move. Once achieved, the GBP/JPY first support would be 152.90. Breach of the latter would expose 148.97, followed by the 100-week moving average (WMA) at 145.31.

Daily chart

The GBP/JPY depicts the pair as neutral, tilted upwards despite failing to break the five-month-old downslope trendline, drawn from October tops that pass around 157.50, followed by a pullback towards 156.00. Nevertheless, the GBP/JPY printed a fresh weekly high on Friday, keeping the bias unchanged.

That said, the GBP/JPY first resistance would be 157.00. A decisive break would expose 157.50, followed by a January 5 daily high at 157.76, and the October 2021, a cycle high at 158.21.