FX.co ★ Wiking | GBP/JPY

GBPJPY Daily Analysis The trend over the past few months on GBP/JPY has overwhelmingly tilted bullish, particularly in late March 2025 establishing the key low around 187.00 from which the market began to make a consistent series of higher lows and higher highs, laying the ground work for what would become a more prolonged bull trend which was further established over the summer months. The advance began to pick up speed in late May 2025, when price movement, in the context of the prevailing market mood, consolidated and broke the 195.50 resistance level. This shift in mood signaled consolidation into an aggressive bullish continuation. During the months of summer, the uptrend continued, with the pair moving along a trendline to the rising trendline which was established on the low of the last week of March and pushed through the swing lows of June and August, The pair was moving to the June and August lows. Between June and mid-August 2025, GBP/JPY traded within a bullish and somewhat contained channel. Price action was supported by the 20 and 50 period moving averages which provided the strong support needed to maintain the bullish channel. Those dynamic supports served as repetitive launching points for bullish extensions. The breakout in early September 2025 above the 200.00 psychological level reaffirmed a profound change in market dynamics, as it was the pairs initial prolonged close above the level since 2022. Following this breakout. Positive bullish sentiment continued on October 8, 2025, when GBP/JPY reached its high for the day at 205.80. This represented an increase of nearly 10% from the 187.50 August bottom, evidence that buyers were dominant. After the peak in October, however, the market began showing exhaustion. Candle bodies shrunk in size, and the appearance of upper wicks indicated that buyers were losing conviction and sellers were gaining strength from 205.50 to 205.80. The selling that took place after this high reinforced the corrective phase, and the market declined to 203.48, which is the 23.6% Fibonacci level of the rally from July to October. This level is still the most critical short-term support level. Price is still within this support region, suggesting an attempt to break upwards, but the most recent price action lacks the strength for an escape. This is strengthened by the July 24 low support trendline around 198.00, which is tightly correlated to 203.48. This is further confirmed by the bullish pressure needed to form this market structure. Protecting this level should increase conviction that this recent price action constitutes a bullish continuation after a shallow correction, rather than the start of a potential reversal. Additional levels of support can be located using Fibonacci retracement levels, with the 38.2% level at around 202.28 and the 50% level at 201.18. These levels overlap with earlier consolidation areas seen between late August and early September, adding further technical confluence to possible buy-side responses. A more substantial pullback, although less probable unless a strong selling pressure arises, could travel as far as the 61.8% retracement at 200.07. The price, however, is still well north of the 100-day moving average and continues to honor its positive inclination, which indicates that the general bullish trend is still structurally intact. To the positive, short-term resistance is around 204.50, with a move above there poised to test the recent high at 205.80. A close above that resistance would validate the resumption of the dominant bullish leg, with the 207.00 and 208.50 levels in sight in extension. Analyzing the price action using momentum indicators can give us some clarity. Although the MACD is still positive, the narrowing gap suggests that the bullish momentum is slowing down; however, this is likely just a short-term change. The RSI shows little bullish bias while remaining neutral as it bounces around 60, further suggesting that the RGB/JPY still has room to run before entering the overbought zone. Furthermore, the Stochastics value at 78 shows short-term momentum bouncing back from being oversold and bullish crossovers would likely add new buying pressure. The price action in the middle of October primarily showed the balance between a correction and a continuation of a trend. After the strong bearish candle on October 10, which confirmed that a retracement had begun, it was the hidden buying pressure that explained the small-bodied candles with long lower wicks that followed in the subsequent sessions. This showed that buyers were willing to defend the trend line around 203.00–203.50. The likelihood of another upswing will be activated within the trend channel if the buying pressure continues within the following sessions. Currently, on the daily time frame, the GBP/JPY currency pair shows strong bullish momentum that has been in place since March 2025. Any ongoing corrective price action can be viewed as a normal part of the price discovery process, which is a primary bullish trend and is currently balancing around the trendline support and the 23.6% Fibonacci retracement level. As long as the price is continuously held above the 202.00 handle and is forming higher lows, the structure on the higher time frame is bullish. A sustained daily close above 204.50 would most probably seal the affirmation of fresh upside momentum, leading to a retest of 205.80 and higher targets over the next few weeks. On the other hand, a persistent close below 201.00 would be the initial technical indication of deteriorating trend form, an indication that a shift into a wider-ranging consolidation phase would be likely before another directional impulse.