GBP/JPY Price Analysis: Refreshes weekly low under 139.00 ahead of Brexit talks

• GBP/JPY fails to keep the late Monday’s bounce off 138.74, drops to the lowest since August 11.
• Break of two-week-old rising trend line, 10-day SMA favor the sellers.
• The EU and British negotiators will kick-start final scheduled round of tough negotiations.
• 200-day SMA becomes the key support to watch.

GBP/JPY stands on a slippery ground while declining to 138.67, down 0.17%, during the early Tuesday’s trading. The pound cross refreshed the one-week-low while extending the previous day’s losses below 10-day SMA. The quote marked the biggest losses in seven weeks on Monday after breaking an ascending trend line from July 28.

Other than downbeat technical, backed by sustained break of 10-day SMA and a short-term trend line, fundamentals are also likely to weigh on the pair. The reason could be traced from the strained relations between the bloc and the UK that grabs market attention when policymakers from both the ends discuss Brexit.

Hence, sellers may aim for 138.00 as immediate rest point ahead of 21-day SMA level of 137.80. Though, the 1357.50 mark comprising 200-day SMA will become a tough nut to crack for the sellers.

Alternatively, 10-day SMA and the support-turned-resistance line, respectively around 138.90 and 139.95, followed by 140.00 round-figures may challenge the bulls in a case of any surprises.

It should, however, be noted that the monthly high near 140.20 adds to the upside filters for the pair bulls.

GBP/JPY daily chart

Trend: Bearish