GBP/JPY Price Analysis: Buyers stumble at solid resistance at 166.00, as sellers regain control

• The British pound lost ground vs. the Japanese yen, but it’s positive in the week, up almost 0.80%.
• Investors’ mood improved towards the Wall Street close, but Asian equity futures are stumbling.
• GBP/JPY Price Analysis: Neutral-to-downward biased, though upside risks remain.

The GBP/JPY is barely up almost 0.03%, following Wednesday’s session, where the cross-currency tumbled from weekly highs around 166.25 to hit a daily low at 165.13 before settling around in the mid 165-166.00 range. At the time of writing, the GBP/JPY is trading at 165.58 as the Asian Pacific session begins.

GBP/JPY Price Analysis: Technical outlook

On Wednesday, the GBP/JPY began trading around 165.70s before marching firmly towards the daily highs around 166.22. Nevertheless, the pair fell on UK inflation data, sending the GBP/JPY towards its daily lows around 165.13, breaking below the 20, and 50 hour-EMA’s on its way south. Therefore, the GBP/JPY is neutral biased in the hourly chart, though it might consolidate around the 165.27-88 range before breaking in either way.

GBP/JPY 1-hour chart

The GBP/JPY 1-hour chart depicts the pair as range-bound. However, GBP/JPY traders should notice that price action broke below a nine-day upslope trendline around 165.60, which was later tested. However, GBP/JPY buyers could not hold the exchange rate above it, and meaning sellers outweighed buyers.

Therefore, the GBP/JPY is mild-tilted downwards. If that scenario plays out, the GBP/JPY first support would be 165.27. Break below will send the pair diving to the confluence of the 100-hour EMA and the S1 pivot point around 165.00, followed by the 200-hour EMA at 164.25.  On the other hand, the GBP/JPY first resistance would be the intersection of the daily pivot and the 20-hour EMA around 165.69. A breach of the latter will expose the top of the range around 165.88, followed by the weekly high at 166.25.

GBP/JPY Key Technical Levels