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  • GBP/JPY witnessed a modest pullback from four-week tops set earlier this Tuesday.
  • The set-up hasn’t been supportive of any firm direction and warrants some caution.

The GBP/JPY cross extended its steady intraday pullback from four-week tops and was last seen hovering near the lower end of its daily trading range, just below the 137.00 mark.

The cross has now retreated to an important confluence resistance breakpoint – comprising of 200-day SMA and the 38.2% Fibonacci level of the 142.72-133.05 recent pullback. The mentioned resistance-turned-support, around the 136.70-65 region, should now act as a key pivotal point for intraday traders.

Mixed technical indicators on hourly charts haven’t been supportive of any firm intraday direction. On the other hand, oscillators on the daily chart – though have been recovering from the negative territory – are yet to confirm a bullish bias. This warrants some caution before placing any aggressive bullish bets.

That said, any meaningful pullback might still be seen as a buying opportunity. This, in turn, should help limit the downside near the 136.20-15 region, which is closely followed by the 136.00 mark. Failure to defend the mentioned support levels will negate prospects for any further near-term appreciating move.

On the flip side, the 137.35-40 region now seems to have emerged as immediate resistance. A sustained move beyond has the potential to lift the GBP/JPY cross towards the 50% Fibo. level, around the 137.85 region, en-route the 138.00 round-figure mark.

GBP/JPY daily chart