GBP/JPY Price Analysis: Pullback from Daily High and Bearish Engulfing Pattern Outlining

  • Following the release of US inflation data, GBP/JPY plunges more than 100 points to the 169.00 area.
  • The technical picture is bearish as the RSI points lower and the 3-day RoC turns negative.

The pair GBP/JPY Eases after hitting a daily high of 171.17 after safe-havens rallied following the release of US inflation data. GBP/JPY fell more than 100 pips towards the 169.00 zone as traders anticipate another interest rate hike by the Bank of England (BoE) in its struggle to curb inflation of around 10%.

GBP/JPY Price Analysis: Technical Perspective

After three days of gains, the GBP/JPY pair fell towards the 169.50 zone, as the currency pair formed a bearish engulfing candlestick pattern. Although the Relative Strength Index (RSI) remains in bullish territory, it is still pointing lower, suggesting that buyers are running out of steam awaiting the Bank of England’s decision. The 3-day rate of change (RoC) turned negative, allowing sellers to enter new positions.

If the GBP/JPY pair falls below 169.00, the next support would be the 20-day EMA at 168.33, followed by the April 19 high at 167.97. Once broken, the next GBP/JPY demand zone would be the Dec 20 high turned support at 167.01.

On the other hand, if GBP/JPY recovers to the 170.00 zone, the next resistance would be the May 9 daily high at 170.71. A breakout of the latter zone would expose the GBP/JPY pair to a potential downside. A break of the latter would expose the May 10 daily high at 171.17, which once broken, could pave the way to test the year high at 172.13.

GBP/JPY Price Action – Daily Chart

GBP/JPY Daily chart

GBP/JPY

Overview
Last price today 169.63
Today Change Daily -1.00
today’s daily change -0.59
today’s daily opening 170.63
Trends
daily SMA20 168.16
daily SMA50 164.95
daily SMA100 162.53
daily SMA200 163.6
levels
previous daily high 170.72
previous daily low 169.86
Previous Weekly High 172.34
previous weekly low 168.06
Previous Monthly High 171.18
Previous monthly minimum 162.78
Fibonacci daily 38.2 170.39
Fibonacci 61.8% daily 170.19
Daily Pivot Point S1 170.09
Daily Pivot Point S2 169.55
Daily Pivot Point S3 169.23
Daily Pivot Point R1 170.94
Daily Pivot Point R2 171.26
Daily Pivot Point R3 171.8

Source: Fx Street

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