- GBP/JPY faced rejection near 200-DMA and for now, seems to have stalled the recent bullish move.
- The technical set-up warrants some caution before positioning for any near-term corrective slide.
The GBP/JPY bulls struggled to capitalize on the recent upward trajectory and faced rejection near the very important 200-day SMA. The cross also failed to find acceptance above the 61.8% Fibonacci level of the 144.96-124.07 downfall.
A subsequent fall through the early European session on Thursday suggests that the bullish momentum might have already run out of the steam. However, daily RSI maintained its bullish bias and has already eased from overbought conditions.
Despite the emergence of some fresh selling pressure, it will be prudent to wait for some follow-through selling before confirming that the cross might have already topped out in the near-term and positioning for any further depreciating move.
Meanwhile, immediate support is pegged near the 136.00 mark, below which the cross could slide further towards the 135.50-40 resistance breakpoint. Failure to defend the mentioned resistance-turned-support might be seen as a fresh trigger for bearish trades.
On the flip side, the 61.8% Fibo. level, around the 137.00 round-figure mark, now seems to act as immediate resistance. This is followed by the 200-DMA near the 137.40 region, which if cleared will set the stage for an extension of the recent move up.
GBP/JPY daily chart
Technical levels to watch
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