GBPJPY is looking for a breakout from the upper trendline of a symmetrical triangle at 167.10 after a gradual weekly increase from the 164.00 low.
On the downside, the 23.6% Fibonacci retracement of the latest upleg is currently reducing selling incentives, with the RSI and the MACD suggesting that traders are in a wait-and-see mode as the indicators remain trendless around their neutral levels.
On the other hand, the positive slope in the stochastics is feeding optimism for more upside, though the lines are already close to their 80 overbought level, flagging limited room for improvement. The 168.70-169.80 resistance territory could immediately halt a bullish extension above the triangle. If the bulls successfully pierce through this wall, they will next head for the October peak of 172.10. A break higher would clear the way towards the 175.00 key barrier, which had been last active during 2013-2016.
Alternatively, a close below 166.60 could press the price directly to the triangle’s lower trendline at 164.50. Should sellers snap that floor, the 38.2% Fibonacci of 163.20 and the 200-day simple moving average (SMA) may come to the rescue. If not, the decline may aggressively move towards the 50% Fibonacci of 160.50.
All in all, GBPJPY is expected to trade neutral in the coming sessions unless it sustainably stretches above 167.10 or below 164.50.