GBP/JPY sees sharp buying interest in short-term; moves towards descending trend line.
GBP/JPY surged to a new weekly high of 146.61 in today’s European session, jumping above the 146.20 key level. Also, the price surpassed the 40-simple moving average (SMA) in the 4-hour chart while the short-term technical indicators confirm the bullish structure.
From the technical point of view, the Relative Strength Index (RSI) is heading higher increasing positive advances in price action and lies above the threshold of 50. Furthermore, the MACD oscillator is rising in the negative territory and is approaching the zero line for a possible climb in the positive area in the next few sessions.
Should the market continue the bullish bias, resistance could be met at the 200-SMA near the 147.00 psychological level before being able to challenge the 38.2% Fibonacci retracement level of 147.25 of the down-leg from 153.80 to 143.20. If there is a jump above this region and the medium-term descending trend line, the next major resistance would come from the 148.10 level.
To the downside, immediate support is being provided by the 146.20 hurdle. Further losses could push the pair towards the 23.6% Fibonacci mark of 145.70. A leg below this barrier could see a hit of the 144.40 support, taken from the low on June 19.
To sum up, in the medium-term, the pair is continuing the negative outlook after the pullback from the 153.80 resistance level on April 13.
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