GBP/JPY Price Analysis: Further upside hinges on 166.30 breakout, UK data
- GBP/JPY defends three-month-old resistance breakout amid bullish MACD signals.
- Horizontal area from late June challenge immediate upside moves.
- The key DMA confluence challenges bears, buyers can aim for yearly top.
GBP/JPY picks up bids to consolidate the previous day’s losses around 165.80 during Monday’s Asian session.
In doing so, the cross-currency pair defends the upside break of a three-month-old resistance, now support around 164.15.
Not only the key resistance breakout but the bullish MACD signals also favor GBP/JPY bulls to portray another run-up towards crossing a 10-week-old horizontal resistance area surrounding 166.30.
It should, however, be noted that the pair’s upside past 166.30 won’t hesitate to challenge the yearly peak surrounding 168.50. During the anticipated run-up, the tops marked in late June and April, respectively around 167.85 and 168.40, could act as buffers.
On the flip side, GBP/JPY sellers may not risk fresh entries until witnessing a clear downside break of the resistance-turned-support line around 164.15, as well as the 164.00 threshold.
Also acting as the key downside barrier is the convergence of the 50-DMA and the 100-DMA around 163.00.
In a case where GBP/JPY sellers keep reins past 163.00, an upward sloping support line from May 12, close to 161.30, followed by the 160.00 psychological magnet, will pop up on the radar.
GBP/JPY: Daily chart
Trend: Further upside expected