- GBP/JPY remains depressed near monthly low after breaking an ascending trend channel from late February to the downside.
- Previous month low lures short-term sellers, 50-day SMA adds to the upside barriers.
- Downward sloping RSI, channel break favor sellers targeting 147.40-30 horizontal area.
GBP/JPY reverses the corrective pullback from the monthly low while dropping back to 149.44 during the early Asian session on Friday.
In doing so, the quote respects the previous day’s downside break of a two-month-old ascending channel’s support as well as downbeat RSI conditions. It should, however, be noted that the traders await the UK Retail Sales for March and preliminary readings for Markit PMIs for April for impulse.
Considering the pair’s inability to defy the bearish breakdown, as well as descending RSI line, GBP/JPY prices look set to challenge March’s low near 148.50 during further weakness.
However, a horizontal area comprising late February levels near 147.40-30 will be the key to watch afterward.
Meanwhile, corrective pullback beyond the stated channel’s support line becomes the immediate upside hurdle around 149.80 for the GBP/JPY to watch.
If at all the recovery moves cross the 149.80 resistance, the 150.00 threshold and 50-day SMA near 150.20 can test short-term buyers.
GBP/JPY daily chart
Trend: Further downside expected