GBP/JPY trades in narrow range; bullish move is expected until 148.50.
GBP/JPY is creating a bullish recovery over the last sessions after it hit a 6-month low near the 145.00 psychological level. The prices jumped above the 20 and 40 simple moving averages in the 4-hour chart and are standing below the 148.00 handle. As a side note, the pair has been holding within a narrow range of 146.25 – 147.65 since March 5 and is trying to jump above this area at the time of writing.
From the technical point of view, the market could increase positive momentum in short-term. The Relative Strength Index (RSI) is sloping up in the bullish territory, while the MACD oscillator entered the positive zone and climbed above its trigger line.
If price action remains positive and rises above the 23.6% Fibonacci retracement level near 147.65 of the down-leg from 156.60 to 145.00, the next major resistance to watch is the 148.50 barrier. Further gains could push GBPJPY towards the 38.2% Fibonacci level of 149.40.
Conversely, if the price creates a bearish movement again, then the focus could shift to the downside until the lower boundary of the range at 156.25. If this level is breached, it could increase bearish pressure until the price hits 145.00.
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