Guppy appears to be running out of steam on its climb, but the uptrend could stay intact if these nearby support levels hold.
Are buyers ready to hop in at these correction levels?
GBP/JPY: 4-hour
GBP/JPY 4-hour Forex Chart Faster with TradingView
A combination of risk-taking on easing Middle East tensions and a clear U.K. political transition appears to have lifted GBP/JPY in the first half of July.
However, the rally has stalled as geopolitical conflict has escalated once more, bringing some safe-haven flows back to the yen.
Can the pair still maintain its climb?
GBP/JPY is testing support at its pivot point (218.18) and could still be due for a larger pullback to the next support zone at the 38.2% Fib and S1 (216.75), which happens to line up with the 100 SMA dynamic support.Remember that directional biases and volatility conditions in market price are typically driven by fundamentals. If you haven’t yet done your fundie homework on the British pound and the Japanese yen, then it’s time to check out the economic calendar and stay updated on daily fundamental news!
This moving average is above the 200 SMA and is increasing its lead, suggesting that bullish momentum is still present and strengthening. The line in the sand for a correction could be around the 61.8% Fib and former resistance zone near S2 (215.04), which is just above a rising trend line connecting the lows since May.
Keep your eyes peeled for reversal candlesticks at any of these potential inflection points, as a bounce off support could send GBP/JPY back up to its swing high near R1 (219.89) or to the next upside target at R2 (221.32).
Whichever bias you end up trading, don’t forget to practice proper risk management and stay aware of top-tier catalysts that could influence overall market sentiment!
This GBP/JPY setup leans on trend lines, Fibonacci retracement levels, and pivot points to map out potential bounce zones, tools you may not be using together yet. Premium members can read our lesson:
📖 How to Identify Reversals and Retracements
Reading this helps you understand how Fibonacci levels and pivot points confirm each other, how a trend line break can signal more than just noise, and how to judge whether a pullback like this one is likely to hold or give way to a deeper reversal.
And if you’re not a Premium subscriber yet, now’s a good time to sign up.
With Babypips Premium, you get full access to School of Pipsology lessons that help you understand not just where a level sits on the chart, but how to tell a genuine reversal from a pause on the way to fresh highs or lows.
