GBP/JPY PRICE FORECAST: POUND STERLING MIGHT RECOIL AS YEN APPROACHES MAJOR TECHNICAL LEVEL
GBP/JPY worth motion has weakened sharply over the previous few buying and selling periods. In reality, the Pound Sterling now trades roughly 320-pips off its 05 April swing excessive notched in opposition to the Yen. The stretch decrease by GBP/JPY appears to be a bit stretched, nevertheless, and close by assist might encourage British Pound bulls to stem the bleed.
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GBP/JPY PRICE CHART: DAILY TIME FRAME (16 NOV 2020 TO 08 APR 2021)
GBP/JPY presently hovers simply above the psychologically-significant 150.00-price degree following the newest inflow of promoting stress. Although it’s attainable that current Pound-Yen weak spot is just a few wholesome revenue taking subsequent to the huge 8% rally in the course of the first quarter. This brings to focus a confluence of assist across the 23.6% Fibonacci retracement proven on the chart above, which could bolster GBP/JPY worth motion. Technical assist close to the 149.50-level is highlighted by the 50-day easy transferring common as properly.
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This space additionally occurs to be roughly underpinned by the underside Bollinger Band, late-March swing low, and an ascending trendline. Sustaining this layer of protection might see GBP/JPY worth motion recoil towards its 20-day easy transferring common earlier than recent year-to-date highs come into consideration. Then again, invalidating the aforementioned technical assist degree may be adopted by a deeper pullback that pressures GBP/JPY worth motion towards its 100-day easy transferring common.
— Written by Wealthy Dvorak, Analyst for DailyFX.com
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