21 Nov 2024

GBP/JPY may experience further depreciation as the analysis of the daily chart indicates a bearish trend. The nine-day Exponential Moving Average (EMA) is positioned below the 14-day EMA, which suggests ongoing weakness in short-term price momentum. Immediate support is identified at the lower boundary of the descending channel, specifically at the 193.50 level. Currently, the GBP/JPY pair has retraced some of its recent gains, trading around 195.80 during the early hours of Thursday in Europe. The daily chart analysis reveals that the pair is situated within a descending channel pattern, reinforcing the bearish outlook.

The 14-day Relative Strength Index (RSI) is marginally below the 50 threshold, further confirming the bearish momentum. Additionally, the positioning of the nine-day EMA below the 14-day EMA indicates a sustained weakness in short-term price dynamics.

On the downside, the GBP/JPY pair may approach the lower boundary of the descending channel at the 193.50 level. A decline below this level would strengthen the bearish sentiment and exert downward pressure on the currency pair, potentially revisiting the two-month low of 189.56 recorded on September 30.

Conversely, on the upside, the immediate resistance is found at the nine-day EMA at the 196.46 level, followed closely by the 14-day EMA at 196.63. Further resistance is located at the upper boundary of the descending channel at the 197.70 level. A successful breakout above this channel could lead to a shift towards a bullish bias, enabling the GBP/JPY pair to test the four-month high of 199.81 reached on October 30.