GBPJPY has been in a descending move since it touched the one-month peak of 135.70. Currently, the price is revisiting the 23.6% Fibonacci retracement level of the down leg from 135.70 to 124.00 at 132.97 – which stands near the short-term falling trend line and the Ichimoku cloud.
Looking at the technical indicators, the MACD oscillator is weakening its negative momentum and is approaching the zero line, while the RSI indicator is hovering near its neutral threshold of 50. Both are confirming the recent bearish to neutral bias in the near term.
The market seems to be supported by the descending trendline that joins the highs from April 9 and therefore only a decisively close above it would put traders in a positive mode. To reach that floor and re-challenge the 133.80 territory, the price should first breach the 23.6% Fibo at 132.97, while above this line the bulls are eagerly waiting to take full control and drive towards a tougher barrier around the 135.00 round number and the one-month peak of 135.70. Clearing that obstacle too, all attention will turn to the 137.20 barrier, identified by the high on March 10.
Alternatively, if the bears dominate below 133.00, the spotlight will shift back to the 131.87 support level, a break of which could extend the downtrend towards the 38.2% Fibo of 131.24. Below that, the door would open for the 130.60 support and the 50.0% Fibo of 129.84.
In brief, GBPJPY is expected to hold a neutral to bearish direction unless the price closes significantly above the descending trendline and the 23.6% Fibo of 132.97.
