• GBP/JPY has dived out of a bullish channel, as per the 4-hour chart.
  • A retest of the recent low of 136.56 looks likely.

GBP/JPY is currently trading at 137.39, representing a 0.20% loss on the day. The risk-off tone in the equities seems to have put a bid under the anti-risk Japanese Yen.

Looking forward, the JPY cross risks revisiting the recent low of 136.56 in the short-term, as the 4-hour chart is reporting a rising channel breakdown.

Further, the 4-hour chart relative strength index (RSI) is reporting bearish conditions with a below-50 print, having witnessed a head-and-shoulders breakdown in the US trading hours on Wednesday.

The case for a pullback to 136.56 would weaken if the pair finds acceptance above 138.32.

4-hour chart

Trend: Bearish

Technical Levels