GBPJPY maintains a bullish intra-day bias after breaching the key 152 level yesterday. The pair has breached the upper end of the two-month consolidative range after a strong rally.
Strong support held at the 147 level and GBPJPY bounced off the bottom of the range to rise with strong momentum all the way back to the top of the range and consequently breaking above it.
Looking at the 4-hour chart, momentum appears to have faded and the market has become overextended following the strong surge. The RSI has entered overbought levels above 70. This suggests GBPJPY may consolidate in the near term or even see a pullback.
To the downside, strong support is now being provided at 152. If it fails to hold, then prices would fall back into the medium-term range. As long as GBPJPY can sustain trading above 152 then the consolidative phase has ended and this could be the start of a new bullish phase.
Risks are clearly tilted to the upside with scope to extend towards the 160 handle. On the 4-hour chart, it appears that there could be an imminent bullish crossover of the 50 and 200-period moving averages. On the daily chart, the moving averages are bullishly aligned.
