GBP/JPY technical analysis: On the defensive but falling wedge breakout is still valid

GBP/JPY eyes gain toward 138.50 with the 4-hour chart reporting a falling wedge breakout.
A break below 137.40 is needed to invalidate the bullish setup.

Omkar Godbole FXStreet Contributor

With the US Dollar gaining ground against majors except for the Japanese Yen, the GBP/JPY pair has dipped below 138.00. Despite the 0.15% drop, the outlook remains bullish, as the falling wedge breakout or the bearish-to-bullish trend change confirmed on June 5 is still valid.

The pair, therefore, remains on the hunt for 138.73 (resistance as per the 4-hour chart). Supporting the bullish case is the impending bullish crossover of the 5- and 10-day moving averages (MAs).

The outlook, however, would turn bearish if the 4-hour chart rising trendline support, currently at 137.40, is breached.

4-hour chart

Trend: Bullish

Pivot points

1. R3 138.85
2. R2 138.51
3. R1 138.16
PP 137.82
1. S1 137.46
2. S2 137.12
3. S3 136.77

Author

Omkar Godbole

FXStreet Contributor

Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.

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