GBP/JPY Price Analysis: Consolidates around 155.70 as market participants are in wait and see mode
- The GBP/JPY bounces off daily lows, though it loses some 0.06% in the day.
- Market participants’ lack of conviction keeps the GBP/JPY range-bound.
- GBP/JPY is range-bound with no apparent bias, but Monday’s price action gives “hope” to GBP/JPY bulls.
The GBP/JPY consolidated around the 154.30-156.50 range in the last week, as risk-sentiment fluctuates between risk-off/on mood. At the time of writing, the GBP/JPY is trading at 155.78.
As portrayed by US equities, financial markets are mixed, fluctuating between gainers and losers. In the FX complex, a risk-on market mood spurred demand for risk-sensitive currencies, like the British pound. Nevertheless, so far, trimmed earlier losses vs. the Japanese yen.
GBP/JPY Price Forecast: Technical outlook
GBP/JPY Monday’s price action witnessed the pair falling towards 155.13, a daily low, though the GBP bounced off the lows as the North American session progressed.
In the last two days, the GBP/JPY price action has printed lower daily highs/lows, suggesting that the pair is headed downwards, despite that the daily moving averages (DMAs) indicate the GBP/JPY is upward biased.
That said, GBP/JPY traders may wait on the sidelines, expecting a breakout of the 154.30-156.50 trading range.
Nevertheless, the long wick below the candlestick “real body” gave clues that the pair might resume the upward move based on Monday’s price action. The first resistance on the way north would be 156.00. Once that level gives way, the next resistance would be February 3 daily high at 156.50, followed by the 157.00 figure.
On the downside, the break of 155.00 would expose the DMAs as targets for GBP/JPY bears.
