GBPJPY starts a new brief bearish cycle after fresh highs
Support at 185.60, but sellers need to drive deeper to change outlook
GBPJPY switched into corrective mode, erasing half of its weekly wins after almost approaching the November 15, 2015 peak of 188.80.
The doji candlestick, along with the negative reversals in the RSI and stochastic oscillator, indicate that the bears have an advantage in the short term.
A close below 185.60, where the 23.6% Fibonacci retracement of the latest upleg is placed, could extend the decline straight to the 20-day simple moving average (SMA) at 184.40. Then, the 181.95-183.15 trendline region, which encapsulates the 50-day SMA, might bring some stability before a potential downfall squeezes the price into the important 178.00-179.60 territory. A step lower from there would violate the broad positive trend, motivating more selling towards the 200-day SMA at 176.00.
In the opposite scenario, where the pair revives its uptrend above the key bar of 188.80, immediate resistance is expected to develop between the short-term ascending line from March 2023 and the long-term ascending line from October 2022, both seen within the 191.50-192.45 territory. A successful penetration higher might clear the way towards the 2015 ceiling of 195.30-195.87.
To sum up, the current pullback in GBPJPY could gain extra legs in the coming sessions, though any declines might not be worrisome and could be considered part of the broad uptrend unless the pair tumbles below 178.00.
GBPJPY recedes from new highs
