Breakout of a bullish flag exposes movement towards 156.00
- The pound sterling rose at the start of the Asian session, up 0.09%.
- GBP / JPY benefits from a stronger US dollar; as the Japanese yen weakened, GBP / JPY rallied.
- GBP / JPY: The breakout of the bullish flag could propel the parity towards 156.00.
The British Pound is advancing as the Asia-Pacific session overtakes the US session, up 0.09%, trading at 153.94 at the time of writing. Market sentiment was pessimistic for most of the session on Tuesday. However, it rallied at the end of the New York session, with the S&P 500 and Dow Jones Industrial rising, while the tech-heavy Nasdaq Composite fell.
During the day, earlier in Tuesday’s Asian session, the British pound fell to 153.20, following in the footsteps of the GBP / USD pair. However, as European traders walked to their desks, the downward pressure on safe haven currencies weakened, with the exception of the US dollar. That said, the pound jumped to the day’s low, pushing the GBP / JPY towards the 154.00 figure.
GBP / JPY price prediction: technical outlook
GBP / JPY price action on Monday represented a bullish breakthrough pattern that requires confirmation. As of press time, Tuesday’s candlestick should close above 154.44 to cement the bullish bias; otherwise the GBP / JPY would continue to trade sideways, but in a range narrower than the 152.40-154.30 range, as the upper trendline of a bullish flag is near the 154.00 figure.
If the GBP / JPY breaks the bullish flag, the pair’s next target would be the November 4 high at 156.25.
On the other hand, the failure of a bullish breakout of the bullish flag would open the door to further lows. The first support would be the 50-DMA at 154.30. A breach of the latter would expose the confluence of 100 and 200-DMA around the 152.40-70 region.