Despite the recent consolidation, the short-term oscillators are indicating that near-term risks remain tilted to the upside. Specifically, the RSI is flatlining above its 50-neutral mark, while the MACD histogram is strengthening above both zero and its red signal line.
To the upside, should buying pressures persist, the pair could encounter initial resistance at the recent peak of 166.30, which has also acted as a strong ceiling multiple times in July and June. Piercing through this region, the bulls might then aim for the 167.83 hurdle. A break above the latter may open the door for the six-year high of 168.60.
Alternatively, bearish actions could send the price to test the 164.30 region. Violating this zone, the pair might descend towards 160.70 before the spotlight turns to the July low of 159.43. Failing to halt there, any further declines could then cease at the 158.00 mark, which has acted both as resistance and support in the past months.
In brief, GBPJPY seems to be entering a consolidation phase after its upside move failed to strengthen further. Nevertheless, a close above the 166.30 ceiling may signal the resumption of the pair’s rally.
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