GBPJPY: Cross Having Problems to Post Higher Highs

The GBPJPY cross ticked lower on Monday and was located at 0.10% lower during the London session, trading at around the 149 mark.

The price has failed to breach above the previous highs near 149.50/60 a couple of times already and, it appears that bulls are getting frustrated, which could point to a possible correction in the near-term. Sentiment seems to be negative for the JPY cross, as Chinese stocks have tumbled, and EU stocks seem to be also heading lower, suggesting JPY might strengthen today.

Bulls may defend the short-term trend line at 148.60, where the previous highs are also located. If this support does not hold, the GBPJPY cross could decline to 148.00 in the initial reaction. Another buying area seems to be at around 147.60.

Resistances and selling offers are located at the mentioned 149.50/60 zone and if broken, the cross could jump beyond the psychological level of 150.00.

As long as the GBPJPY cross remains above the broken longer-term bearish trend line (the black trend line on the chart), which is at around 147.00, the medium-term outlook seems bullish and dips could be bought. A drop below this level would cancel the bullish bias and the downward trend could be renewed.

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