GBP/JPY re-challenges uptrend line in the near-term.
GBP/JPY has been moving lower, reaching the short-term rising trend line. The price dropped below the 20- and 40-simple moving averages in the 4-hour chart, while the technical indicators are confirming the recent risk to the downside. The RSI indicator is pointing down near the 50 level and the %K line of the stochastic oscillator is ready for a bearish cross with %D line.
If the price penetrates the uptrend line, this could shift the upside price action to the downside, hitting the 147.60 support and then the 23.6% Fibonacci retracement level of the up-leg from 139.90 to 149.70, near 147.40. In case of more losses, the market could touch the 146.95 level, taken from the lows at the beginning of the week.
Should price manage to change the negative momentum to positive, the next resistance could come around the 149.10 level. Above this level, the next target could be the four-month high of 149.70 before moving towards the strong psychological level of 150.00.
Looking at the short- to the medium-term picture, the bias remains positive since prices hold above the ascending trend line, which has been standing since September 7 when the upside tendency started after the rebound on 139.90.
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