- GBP/JPY has backed off from highs near 141.50 registered on Thursday.
- A deeper drop to key support at 139.32 looks likely due to the bearish divergence of a technical indicator.
GBP/JPY is currently trading near 139.70, representing a 0.22% loss on the day, having hit a high of 141.50 on Thursday on Brexit optimism.
The ongoing pullback is likely to be extended further to the 50-hour moving average (MA) support, currently at 139.32, as the 4-hour chart is reporting a bearish divergence of the relative strength index (RSI). Further, the long upper wick attached to Thursday's candle and the overbought reading (above 70) on the RSI indicates buyer exhaustion.
It is worth noting that the 50-hour MA consistently reversed pullbacks throughout the recent 1,100 pip rally from 130.43 to 141.50. The short-term outlook, therefore, would turn bearish if the 50-hour MA support is breached.
A strong bounce from that key support may yield a re-test of Thursday's high of 141.50, although as of now, that looks unlikely.
Trend: Deeper pullback likely
|Today last price||139.71|
|Today Daily Change||-0.36|
|Today Daily Change %||-0.26|
|Today daily open||140.07|
|Previous Daily High||141.51|
|Previous Daily Low||138.59|
|Previous Weekly High||137.9|
|Previous Weekly Low||130.42|
|Previous Monthly High||135.75|
|Previous Monthly Low||126.67|
|Daily Fibonacci 38.2%||140.4|
|Daily Fibonacci 61.8%||139.71|
|Daily Pivot Point S1||138.6|
|Daily Pivot Point S2||137.14|
|Daily Pivot Point S3||135.68|
|Daily Pivot Point R1||141.52|
|Daily Pivot Point R2||142.98|
|Daily Pivot Point R3||144.44|
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.