GBPJPY approaching long term resistance

The British pound has been strengthening against the Japanese yen ever since the United Kingdom and the European Union struck a trade deal last December.

The Bank of England provided a strong signal in February that it will be not going down the root of negative rates. That hawkish statement made investors trust the Pound which rose against much of its peers. The GBPJPY, however, is approaching an almost three year old resistance level around the 151.00 – 153.00 zone on the weekly chart (A). The Relative Strength Index is just below the 80 level, signaling an overbought territory. Most probably the bears are preparing their paws to take advantage of this strong level and push the course lower. The ascending trendline, connecting previous lows, could provide support, which is converging with the 50 moving average.

In the opposite case, if the bulls managed to break above the resistance level and leave the 154.00 course behind, they would need to fight another resistance just around the 155.00 level (B).