A recent upswing took GBP/JPY above a key resistance zone, opening the door to a possible longer-term trend reversal.
Is GBP/JPY gearing up for an upside breakout?
Let’s check out the pair’s 4-hour chart:
GBP/JPY 4-hour Forex Chart by TradingView
U.S. officials hinting at exemptions to Trump’s tariff plans and traders shrugging off Uncle Sam’s hotter-than-expected January CPI print got traders taking on more risks on Wednesday. European currencies like the British pound, in particular, got an extra boost from the possibility of a peace deal between Russia and Ukraine.
Meanwhile, the Japanese yen took a hit across the board after the Bank of Japan’s Governor skipped any hawkish signals in his latest speech.
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 Japanese yen, then it’s time to check out the economic calendar and stay updated on daily fundamental news!
GBP/JPY, which has been climbing all week, pushed past the key 192.00 psychological level.
More importantly, it’s now trading above the R1 (191.59) Pivot Point, the 100 SMA on the 4-hour chart, and the trend line resistance that’s kept bulls in check since the start of the year.
Is GBP/JPY ready for a bullish reversal?
Keep an eye on more bullish candlesticks and steady action above 192.00, which could draw in more buyers and send GBP/JPY toward 194.00 or even 195.00.
If the pair starts consolidating at these levels instead, a return to its broader 2025 downtrend is still on the table.
In that case, watch for bearish candlesticks and sustained pressure below 192.00, which could open the door for a dip back to 190.00—or even 189.00.
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!
