GBPJPY lost its footing in recent months as it was projected to bounce back to pre-pandemic levels in September. However, a downturn at the back end of Q3 saw the pair flirt with yearly lows before an upsurge in the price.
Exhaustion is now evident as a fall under 138.00 switches the bias to the downside.
We now look for support at the 50% of the 142.69/133.02 long term downside Fibonacci leg. Should prices break through the specified level, then 38.2% will be the next target.
Should momentum remain, this could lead the way for a possible hidden bearish divergence that could test monthly lows.
We now await a breakout as prices now trade between the convergence and baselines of the Ichimoku indicator.
An intraday perspective hints at a possible support at the lower border of the cloud. This could spur prices back to weekly highs, with the current candlesticks being engulfed.
We now look ahead for a breakout between the 50% and 38.2% of the 134.37/140.27 upside leg.
If resistance does not hamper a move over 138.00, then the next target will be the top border of the cloud, which is a confluence with the baseline.
A bullish divergence noted on the momentum indicator could support this rhetoric further, as we wait for further clues for a push to the upside.