GBP/JPY Eyes 200.00 Resistance as Bullish Momentum Builds

GBP/JPY Eyes 200.00 Resistance as Bullish Momentum Builds

The GBP/JPY currency pair is edging higher on Wednesday, trading around 199.45 during the European morning session. Gains in the British Pound (GBP) are supported by better-than-expected UK CPI inflation data for June, which has tempered market expectations of immediate rate cuts by the Bank of England (BoE). The Japanese Yen (JPY), on the other hand, remains capped amid BoJ policy inertia and political uncertainty.

Technical Outlook: Bulls Hold Firm Above 100-Day EMA

The technical structure for GBP/JPY stays bullish as long as the price holds above the 100-day Exponential Moving Average (EMA). The Relative Strength Index (RSI) stands strong at 60.80, indicating sustained momentum in favor of bulls.

Support and Resistance Levels:

• Key Resistance: 200.00 (psychological + Bollinger Band top)
• Next Resistance: 200.75 (May 28 high), then 204.23 (July 19 high)
• First Support: 198.11
• Secondary Support: 196.60

A break and close above 200.00 would likely accelerate the bullish momentum, targeting the multi-month highs.

UK Data in Focus: Inflation Today, Employment Tomorrow

The recent UK inflation report exceeded expectations, with CPI remaining sticky, hinting at persistent price pressures. This development supports the GBP, especially against lower-yielding currencies like the JPY. Traders now turn their attention to UK employment data, scheduled for Thursday, which could further sway BoE rate outlooks.

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