GBP/JPY quote near maximums of several months with the intact bullish trend

• The GBP/JPY is quoted just below the maximums of the year around 198.35 in the American afternoon.
• The pair is still supported within an ascending channel, with a trend structure that is firmly bullish.
• The immediate resistance is observed in 199.00 and the maximum of December 2024 in 198.96.

The sterling pound (GBP) is strengthened in front of the Japanese Yen (JPY) on Wednesday after registering minimum losses on Tuesday, extending its upward impulse near the maximum of the year. The GBP/JPY has been quoting in a favorable position since last week, supported by the general weakness of the YEN and the firm demand of the pound amid divergent perspectives of monetary policy.

At the time of writing, the GBP/JPY is traded just below its maximum of the year around the 198.35 mark during the American afternoon. That said, the YEN is widely weaker in general, pressed by the last summary of opinions of the Bank of Japan, which reflected a cautious position on a greater hardening of politics. The reluctance of the Central Bank to commit to a clear schedule for increased fees – despite persistent inflation signals – has reinforced the narrative of divergence of policies, keeping Y in a defensive position.

In the United Kingdom, the governor of the Bank of England (BOE), Andrew Bailey, and Vice Governor Dave Ramsden reinforced the opinion that interest rates will probably fall in the coming months, citing signs of slack in the labor market. Bailey pointed out the deceleration of salary growth and the increase in economic inactivity such as evidence of the decrease in inflationary pressures, although he also expressed concern about the reliability of labor data. Despite these Muices Dovish, market participants still anticipate a path of cautious relaxation, maintaining the underlying support for intact pound.

This divergence in monetary policy has created a significant performance differential, making the pound more attractive to investors. The highest interest rates in the United Kingdom support Carry Trade flows that favor GBP over low performance YEN, exerting bullish pressure on the GBP/JPY exchange rate.

From a technical point of view, the GBP/JPY remains comfortably within an ascending parallel channel, with the intact bullish structure. The torque has been forming higher and higher since mid -April and continues to quote much above the 50 -day exponential (EMA) mobile average, currently around 194.25. This level has consistently acted as dynamic support.

Impulse indicators support the upward perspective. The Relative Force Index (RSI) is about 65, in ascending trend but not yet in overcompra territory, leaving space for more profits. Meanwhile, the histogram of the convergence and divergence of mobile socks (MACD) is expanding after a recent bullish crossing, reinforcing the upward inclination.

The immediate resistance is observed in the upper limit of the ascending channel and the round figure of 199.00, just below the maximum oscillation of December 30, 2024 in 198.96. A clear rupture above this area would mark a new annual maximum and could pave the road to 200.00 and beyond. Down, the initial support is about 196.00 (midline of the channel), followed by the 50 -day EMA. While the torque is maintained above these levels, the road of lower resistance remains up.