GBPJPY is one of the major pairs that experiences the biggest downward move today. Pair drops around 0.4% to 188.25 area - the lowest level in a month. This is because GBP is one of the worst performing G10 currencies and JPY can be found among outperformers today. Gains on JPY are driven by Jiji report published over the weekend, in which the media service hinted that Bank of Japan may abandon the yield curve control mechanism. There were no specific news behind today's underperformance of GBP.
Taking a look at GBPJPY chart at D1 interval, we can see that the pair dropped below the 50-session moving average (purple line) for the first time since January 10, 2024, and is now testing the 188.25 support zone. A point to note is that the pair seems to have made a decisive break below the 189.00 area, which marks the neckline of a recent double top. A textbook range of the breakout suggests a possibility of a move to as low as 186.75 area. Reaching this level would result in the pair breaking below the 187.65 area, marked with the lower limit of the local market geometry, what in turn would signal at a reversal in short-term trend. In such a scenario, the 186.25 area will be the first support zone to watch, followed by 183.50 zone.
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Source: xStation5
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