GBP/JPY Price Analysis: Wednesday’s rally capped at the neckline and retraces near 152.00
- The GBP/JPY resumed its downtrend once GBP bulls failed to break the double-bottom neckline.
- A downbeat market mood spurred demand for safe-haven assets, including the yen.
- GBP/JPY Technical Outlook: The downtrend resumed and would accelerate if a daily close below 152.00 is achieved.
The British pound retreats from weekly highs amid a risk-off market mood, as Russia-Ukraine Foreign Ministers reported no advancement on negotiations. At the time of writing, the GBP/JPY is trading at 152.13 in the North American session.
Thursday’s market sentiment is downbeat, as the Russia-Ukraine conflict weighs on risk appetite. On Wednesday, the positive mood lacked the news that confirmed a truce or ceasefire between both countries. Furthermore, Russia and Ukraine still adhere to their initial demands, so the conflict would presumably escalate, as nobody wants to give in to their needs.
GBP/JPY overnight seesawed around the 152.29-153.00 range, above the 152.94 where the doublet-top neckline sits. However, the GBP/JPY resumed its downward bias once market sentiment shifted when it was reported that discussions between Russia-Ukraine in Turkey did not fulfill investors’ expectations, so the GBP/JPY dropped towards the 152.00 mark.
GBP/JPY Price Forecast: Technical outlook
The GBP/JPY is downward biased, as depicted y the daily chart, and failure at the neckline as mentioned on Wednesday’s note that said “The GBP/JPY neckline lies at 152.94 and would be a problematic resistance level to overcome for GBP bulls due to the increased selling pressure linked to the double-top,” triggered a 100-pip downward move, below 152.00.
That said, the GBP/JPY first support would be March 8 daily low at 150.97. Breach of the latter would expose last year’s crucial support levels, lead by December 20 low at 149.60, followed by the December 3 low at 148.97, and the double-top target at 148.00.
