GBP/JPY Price Analysis: Continues two-day winning streak as BoJ Ueda remains dovish

• The cross is picking strength amid weakness in the Japanese Yen led by BoJ Ueda’s dovish stance.
• GBP/JPY is in a markup phase after delivering a breakout of Wyckoff’s Accumulation.
• The RSI (14) is aiming to shift to the bullish range of 60.00-80.00, which will result in a bullish momentum ahead.

The GBP/JPY pair has refreshed its two-month high at around 164.46 in the Asian session after continuing its two-day winning streak. The cross is picking strength amid weakness in the Japanese Yen led by the dovish stance adopted by Bank of Japan (BoJ) Governor Nominee Kazuo Ueda over monetary policy guidance.

BoJ Ueda considers the current monetary policy as appropriate for spurting the wages and growth rate as a recent jump in Japan’s inflationary pressures is backed by rising import prices. Therefore, a sustained 2% inflation target can be achieved by keeping the expansionary monetary policy intact.

Meanwhile, the Pound Sterling is enjoying gains due to the smooth flow of the Northern Ireland deal with European Commission (EC) President Ursula von der Leyen. The Agreement assures smooth free-flowing trade from the European Union with the United Kingdom citing the UK and EU are allies, friends, and trading partners.

On a daily scale, GBP/JPY is in a markup phase after delivering a breakout of Wyckoff’s Accumulation pattern. Wyckoff’s accumulation indicates a period of inventory shift from the retail participants to the institutional investors. The cross is marching towards the horizontal resistance plotted from November 17 high around 169.10.

The 10-period Exponential Moving Average (EMA) at 162.65 will continue to provide support to the Pound Sterling bulls.

Meanwhile, the Relative Strength Index (RSI) (14) is aiming to shift to the bullish range of 60.00-80.00, which will result in a bullish momentum ahead.

A decisive break above the immediate resistance of 164.50 will drive the cross toward December 20 high around 167.00 followed by the ultimate resistance plotted from November 17 high around 169.10.

Alternatively, a break below February 24 low at 161.22 will negate the bullish reversal and will drag the asset toward February 14 low at 160.11 and January 25 low at 159.50.

GBP/JPY daily chart