Technical Analysis – GBPJPY tests support trendline; bias bearish



GBPJPY pulled back to test the support trendline at 161.00, which connects the lows from spring, after a failed attempt to pierce its 20- and 50-day simple moving averages (SMAs) around 164.00 on Thursday.

From a technical perspective, sellers seem to have the upper hand as the MACD keeps decelerating within the negative zone and the RSI is reversing southwards, putting in some distance below its 50 neutral mark.

If the bears finally achieve a close below the ascending trendline, the 159.86 area, which coincides with the 50% Fibonacci retracement of the 150.96 – 168.70 upleg, could come to the rescue, rejecting any declines towards the 200-day SMA at 158.35. Should the downfall sharpen below the latter, neutralizing the broad picture, the spotlight will turn to the 61.8% Fibonacci of 156.64.

On the upside, a durable move above the 38.2% Fibonacci of 161.95 may shift attention back to the 20- and 50-day SMAs currently at 163.55 and 164.00 respectively. The 23.6% Fibonacci and the key resistance trendline are also within a breathing distance at 164.53 and could deter any improvement towards the 166.23 border. Nevertheless, if upside pressures persist, traders will next target the 167.80 – 168.70 ceiling.

In brief, GBPJPY continues to face negative risks despite finding a strong footing near an upward-sloping trendline. A close below 161.00 could set the stage for the next bearish round.


Latest News


Technical Analysis – EURGBP stays stuck between two diagonal trendlines



Technical Analysis – US 30 index at risk of bearish breakdown


Technical Analysis – BTCUSD retraces after hitting 2-month high

Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.

All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.

Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.

We are using cookies to give you the best experience on our website. Read more or change your cookie settings.

Risk Warning: Your capital is at risk. Leveraged products may not be suitable for everyone. Please consider our Risk Disclosure.