GBP/JPY rally from 184.35 resumed last week. Despite diminishing momentum as seen in 4H MACD, there is no clear sign of topping yet. Initial bias stays on the upside this week for 199.79 resistance. Break there will target 100% projection of 180.00 to 199.79 from 184.35 at 204.14. On the downside, below 196.94 minor support will turn intraday bias neutral and bring consolidations. But near term outlook will stay bullish as long as 193.99 support holds, in case of retreat.
In the bigger picture, price actions from 208.09 are seen as a correction to rally from 123.94 (2020 low). Strong support should be seen from 38.2% retracement of 123.94 to 208.09 at 175.94 to contain downside. However, sustained break of 175.94 will bring deeper fall even still as a correction.
In the longer term picture, while a medium term top was formed at 208.09 (2024 high), it’s still early to conclude that the up trend from 122.75 (2016 low) has completed. But GBP/JPY is at least in a medium term corrective phase, with risk of correction to 55 M EMA (now at 176.62).
