GBP/JPY Price Analysis: Dips below the 20 DMA as sellers eye the 100 DMA

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  • GBP/JPY is trading around known levels, above 163.00.
  • From a long-term perspective, the cross has a neutral bias, awaiting a catalyst.
  • The GBP/JPY hourly chart has a neutral bias, but is leaning lower as sellers gain momentum, as shown by the RSI.

The GBP/JPY falters during the North American session in the middle of a boring day. Investors are preparing for the publication of data on inflation in the US, which will be analyzed by them, with the aim of predicting the next move of the FOMC at the September meeting. At the time of writing, the GBP/JPY pair is trading at 163.15.

Market sentiment is bearish. US stocks are trading at a loss, while in the currency space, haven pairs are starting to make up some ground, except for the US dollar. GBP/JPY is trading close to its opening price, after bouncing from daily lows at 162.62, before hitting daily highs at 163.67. However, risk aversion weighed on the pound, causing the cross to fall.

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GBP/JPY Price Analysis: Technical Outlook

From a daily chart perspective, the GBP/JPY pair has a neutral bias. For the second day in a row, the inability of buyers to break above the 20-day EMA at 136.64 added to the selling pressure on the cross, with bears huddled around the 163.60 area, pushing the exchange rate towards the figure. of 163.00.

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Therefore, the first GBP/JPY support would be the August 8 low at 162.56. If it breaks below, the 5th Aug low at 161.11 will be exposed, followed by the 2nd Aug low at 159.44. Otherwise, if the buyers retake the 20-day EMA at 163.64, that would open the door for a test of the 50-day EMA at 164.21.

GBP/JPY daily chart

On the one hour time frame, GBP/JPY has a neutral bias, trapped in the 161.11-163.84 zone. However, the Relative Strength Index (RSI) shows that the sellers are gaining momentum, with the RSI at 47.26 and crossing below the 7 RSI SMA, which means that the bears are in control. Therefore, the first support for the GBP/JPY would be the 100 hourly EMA at 162.68. Once broken, the next support would be the S2 pivot point at 162.43, followed by the S1 daily pivot at 161.85. On the other hand, a break above 163.84 could send the pair towards the 4th Aug high of 163.97, which, once broken, could open the door for further gains.

GBP/JPY Hourly Chart

GBP/JPY

Panorama
Last Price Today 163.14
Today’s Daily Change 0.06
Today’s Daily Change % 0.04
Today’s Daily Opening 163.08
Trends
20 Daily SMA 163.68
50 Daily SMA 164.27
100 Daily SMA 162.98
200 Daily SMA 158.52
levels
Previous Daily High 163.85
Previous Daily Minimum 162.57
Previous Maximum Weekly 163.99
Previous Weekly Minimum 159.45
Monthly Prior Maximum 166.34
Previous Monthly Minimum 160.4
Daily Fibonacci 38.2% 163.36
Daily Fibonacci 61.8% 163.06
Daily Pivot Point S1 162.49
Daily Pivot Point S2 161.89
Daily Pivot Point S3 161.2
Daily Pivot Point R1 163.77
Daily Pivot Point R2 164.45
Daily Pivot Point R3 165.05

Source: Fx Street

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