GBP/JPY Price Analysis: Soars towards 166.00 after Fed’s dovish statement

• GBP/JPY advanced sharply as the US Fed tilted dovish on its monetary policy statement.
• Sentiment is positive once the US central bank conceded that the US economy is softening.
• GBP/JPY Price Analysis: Upward biased and might test 167.00 soon.

The GBP/JPY rallies towards the 166.00 figure amidst a risk-on impulse due to the US Federal Reserve hiking 75 bps the Federal funds rate (FFR) while also acknowledging that the US economy is slowing and conceding that they are in neutral territory. At the time of writing, the GBP/JPY is trading at 165.96.

GBP/JPY Price Analysis: Technical outlook

The GBP/JPY daily chart is upward biased. On Wednesday, unexpectedly, the pair jumped 133 pips and reclaimed the 166.00 mark, courtesy of the GBP/USD bounce after the Fed decision. That said, the GBP/JPY broke a two-month-old downslope trendline, which helped sellers to spot fresh entries in the pair, but once cleared, that would pave the way for further gains.

Therefore, the GBP/JPY's first resistance would be the June 28 daily high at 166.94, followed by the June 22 swing high at 167.85.

GBP/JPY 1-hour chart

The GBP/JPY hourly chart also depicts the pair as upward biased. Nevertheless, GBP/JPY buyers should know that the exchange rate is facing a solid resistance of around 166.00. If the GBP/JPY breaks decisively above the previously mentioned, the next resistance would be the R1 daily pivot at 166.65. Once cleared, the next ceiling will be the R2 pivot at 167.37, followed by the June 22 high at 167.85.

GBP/JPY Key Technical Levels