Guppy recently fell through a long-term ascending trend line, suggesting that a reversal is in the cards.
Can it still pull up for a retest of the former support?
Check out these inflection points where sellers might be waiting.
GBP/JPY: Daily
GBP/JPY Daily Forex Chart Faster with TradingView
A hawkish surprise from the Bank of Japan (BOJ) in their latest policy decision, combined with currency intervention by officials from the U.S. and Japan, sent the yen soaring over the past few days.
Despite similarly hawkish vibes from the Bank of England (BOE) earlier last month, Sterling proved no match for yen strength while risk-off flows on elevated Middle East tensions also came into play.
Can Guppy sustain its trend reversal from here?
GBP/JPY has found support at S1 (209.71) and appears to be pulling higher to nearby resistance zones while waiting for more sellers to hop in.Remember that directional biases and volatility conditions in market price are typically driven by fundamentals. If you haven’t yet done your 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!
The Fibonacci retracement tool highlights potential levels that could keep gains in check. The 38.2% level is close by and is near the 218.50 minor psychological mark, while a larger correction could reach the 50% Fib that’s in line with the pivot point (214.66) and the broken trend line.
Keep your eyes peeled for reversal candlesticks at these levels, as a return in bearish momentum could take Guppy back down to the swing low or to fresh bearish targets closer to S2 (207.16).
On the other hand, long green candles surging past the 61.8% Fib could suggest that pound bulls aren’t backing down, possibly lifting the pair up to bullish targets near R2 (217.25) or higher.
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!
GBP/JPY just broke down through a long-term ascending trend line, and the article’s central question is whether price will now come back up to retest that broken support, a scenario you may not be familiar with by name. Premium members can read our lesson:
📖 The Break-and-Retest: A Higher-Probability Breakout Entry
Reading this helps you understand why a broken trend line so often gets revisited before a move continues, how a former support level can flip into resistance once price returns to it, and how to judge whether a bounce back to that line is a bearish retest opportunity or a sign the reversal is failing.
And if you’re not a Premium subscriber yet, consider joining.
With Babypips Premium, you get full access to School of Pipsology lessons that help you understand not just that GBP/JPY broke a trend line, but how to read whether a bounce back to that line is a trap for late bulls or a genuine change in direction.
