GBPJPY recently experienced a pullback from its 16-year peak of 208.10, marking its lowest level since May 16. The pair has been on an uptrend since early 2024, hitting a high on July 11. However, the price has since violated both the supportive trendline from January and the 50-day SMA. This indicates a potential downward trend in the short term.
If the bears continue to push the price lower, they may need to clear the June low of 197.18 before targeting the recent two-month low of 195.84. Further downside movements could see the pair testing the March resistance of 193.52 and possibly finding support at the 190.00 psychological level, which was strong in April.
On the other hand, if the price starts moving higher, it may face resistance at the April peak of 200.50, with a possible advance towards 202.08 before hitting the July resistance at 205.77. Breaking above this resistance could pave the way for a retest of the 16-year high of 208.10.
GBPJPY is currently undergoing a correction from its recent high, with the breach of the ascending trendline signaling a more bearish technical outlook. Despite the downside movement, it is essential to note that short-term indicators are suggesting overbought conditions. This indicates that caution should be exercised by bears, as there is still potential for price fluctuations in the near future.