GBPJPY is set to close the week with mild losses for the third time in a row, remaining below July’s seven-and-half year-high of 184.00.
The market sentiment weakened this week. The price tiptoed lower to test the lower band of its one-month-old range at 179.80 and the broken 2023 resistance trendline after being rejected near the 20-day simple moving average (SMA).
The short-term bias is neutral-to-bearish as the RSI is consolidating its downtrend near 50 and the MACD is slowing below its red signal line.
If the 179.80 floor collapses, there is potential for a negative correction towards the 50-day SMA at 178.00. A couple of trendlines are in the region, including the support trendline from March. Slightly lower, the constraining line that links the highs from April and October 2022 could be interesting to watch at 177.20. If sellers dominate there, the decline could pick up pace towards the 175.00-174.60 zone.
On the upside, the bulls will need to do some extra homework to pierce through the restrictive 20-day SMA at 182.00. If efforts prove successful, the price could fly directly to the 184.00 top or slightly higher to test the long-term resistance line from May 2021. Claiming that territory, the focus will turn to the 186.00 round level, where the pair faced some limitations during 2015-2014. Should buyers push higher, the next obstacle could develop within the 187.35-188.35 and then around 190.00.
Summing up, GBPJPY is still in a neutral phase in the short-term picture, with traders waiting for a move below 179.80 or above 182.00 to drive the market accordingly.
