GBPJPY has been underperforming in the past two days, breaking back below the key 150.00 level. When looking at the bigger picture the pair lacks a clear trend and has been consolidating after its rally from 141.34 stalled at 152.85.
On the 4-hour chart, prices rebounded off the lower Bollinger band around 149.00 but based on technical indicators, momentum is too weak to provide a sustained move higher. RSI is below 50 and MACD is flat.
If price action remains above 149.00 (immediate support), there is scope to test 150.00. Clearing this key level would see additional gains towards 151.50. This is considered to be a strong resistance area which has been rejected a few times in the past. Rising above it would see prices re-test the 152.85 peak and then from there above there would be a resumption of the uptrend form 141.34.
If 149.00 support fails, then the focus would shift to the downside towards 147.00. This level is the 50% Fibonacci retracement level of the upleg from 141.34 to 152.85 and thus is an important level, which if breached, would increase downside pressure and bring about a reversal of the trend. From here, GBPJPY would be on the path towards the 141.343 low.
Overall, GBPJPY has been neutral since peaking at 152.85. Near-term weakness is expected to remain as long as price action take place in the lower end of the Bollinger band.
