GBPJPY 1H Drop Incoming

FX:GBPJPY   British Pound / Japanese Yen
GBPJPY showed sharp gains on Mondays Asian and European sessions with the pair rising from a bearish 151.500 to 153.750 at its peak, looking primed to continue back towards the 155 mark which the bulls have been pressuring and sustaining since late May. Coming into todays European session, the currencies volatility had worn off and the pair has been stuttering early this morning in the mid 153 range, this could be the bulls taking a breaking on the resurgence ready to make a move towards the day end, however the more likely situation is that the bulls are exhausted and so is the sterling. After posting great gains over the past few months the sterling has gone from strength to strength, no worse the Yen which has also showed remarkable strength and gains. The Former however is struggling to maintain this momentum and the pound has been slipping its grasp in the mid 155 range for a few weeks now. This could be down to the how well the Yen has performed but the pound's ground beneath its feet is slipping with Boris Johnson's delay of lockdown easing and the 'Delta variant' supposedly creating a whole new problem for the UK and its plans to get the economy back on track. With the Bank of Japan's monetary policy meeting minutes kicking off in the next asian session, we can comfortable predict how the Yen will react after seeing its response to previous BoJ announcements. This will push the Yen higher and ultimately leave the GBPJPY pair looking negative. The sterling has no key fundamental economic releases on the calendar till tomorrow which leaves the stage all set for the Yen in the next Asian session. This enforces my view on the pair slipping back down to the 152 ranges until the Pound takes centre stage tomorrow afternoon where we can see some volatility .

On the Technical analysis side of things, we can see the trend angle of yesterdays resurgence as unsustainable as the pair has slipped so much and pops upwards too sharply to allow any support to be built beneath. It was met with resistance at 153.500 to 153.700 and is struggling to break its barrier. It's since slipped to 153.300 today and isn't showing strong enough signs of breaking the resistance. It may form some degree of support here but there's not enough data to show the pair will as its too short of the Mid may support level of 153.300. The pair has also dropped beneath the SMMA showing further signs of a drop incoming.

I expect a drop to 152.500 and I'll check back in on the pair then to see how sterling and yen are fairing most likely after tonights Asian session. We may have another opportunity to catch the fall back down to the support of 151.400 but theres not enough signs for me personally that the pair can't rebound at 152 and head back upwards.

I look forward to seeing how this one plays out.