GBP/JPY Price Analysis: Demands a test of consolidation breakout of 158.00

• GBP/JPY has recorded yearly highs at 164.64 after a nine-month consolidation breakout.
• A breakout of a flat channel is followed by the re-test of the flat channel.
• The RSI (14) has been established in a 60.00-80.00 range, which adds to the upside filters.

The GBP/JPY pair is oscillating in a narrow range of 160.28-160.85 since Friday. A correction has been witnessed by the cross after hitting a high of 164.64 the previous week. The pair is looking to overstep the ongoing consolidation and is likely to witness gains after breaching the last two trading sessions' high at 161.18.

On the weekly scale, the asset has turned imbalance after remaining balanced in a nine-month prolonged consolidation in a range of 148.60-158.3.0 last week. The cross was auctioning in a flat channel, which indicates tightening volatility. The asset has advanced after breaching the consolidation and has made a high of 164.64 last month.

The 20- and 50-period Exponential Moving Averages (EMAs) at 156.00 and 153.08 respectively are scaling higher, which indicates a continuation of an upside.

Adding to that, the Relative Strength Index (RSI) (14) has established a bullish range of 60.00-80.00, which adds to the upside filters.

A re-test of the upper boundary of the flat channel near 158.00 will trigger the pound bulls and the cross will start advancing towards April’s high at 161.19, followed by March’s highs at 164.65.

On the contrary, yen bulls may dictate the price if the cross drops below the March 21 low at 156.38, which will drag the asset towards the round level support at 154.00. Breach of the latter will send the asset towards the 50-EMA at 153.08.

GBP/JPY weekly chart