GBPJPY has been trading sideways since the day it dived below the 20- and 40-day simple moving averages (SMAs) at 155.60 in the short-term, unable to close below the 200-day SMA and the 152.90 support.
The momentum indicators, though, are currently encouraging that the sell-off may have found a bottom and the pair may be pushing for some recovery. The RSI and the Stochastics are pointing up and are ready to leave the negative zone, while the MACD seems to be stabilizing in the negative area.
Practically speaking, a closing price above the SMAs could boost buying interest in the near term and confirm additional gains towards the 158.20 resistance level, which is the upper boundary of the long-term trading range. Higher still, the 160.20 barrier, taken from the high in June 2016 could also react as resistance.
In the event of a pullback below 152.90, the bears may push harder to clear the 149.50 and the 148.90 floor and head for the 147.40 level, which stands below the sideways channel.
Meanwhile in the long-term picture, the outlook has been remaining in a consolidation area since the last year, with traders waiting a rally above 158.20 to eliminate fears of a down-trending market.
