The British Pound (GBP) continued its upward momentum on Monday, marking its second consecutive day of gains against the Japanese Yen (JPY). The GBP/JPY pair is currently trading just below 210.00, having rebounded from levels near 208.00 last week. Traders are eyeing the top of the monthly trading range, which sits around 211.00, as the next potential resistance level.
The Yen weakened across the board on Friday following Japanese data that showed Household Spending declined for the ninth straight month in August. This decline underscores the negative impact of rising prices on Japan’s domestic demand. Additionally, concerns about Japan’s high public debt and the government’s plans to stimulate economic growth have further eroded market confidence in the Yen.
From a technical perspective, the GBP/JPY pair is displaying a bullish bias, trading at 209.91. Key resistance is identified at the top of the monthly range above 211.00. Momentum indicators on the 4-hour chart support this positive trend, with the Relative Strength Index (14) advancing past the 60 level and the Moving Average Convergence Divergence (MACD) remaining moderately positive.
Bulls may encounter resistance at the September 25 and October 6 and 7 highs, around 210.20, before reaching the range top between the September 18 high at 211.28 and the September 4 highs near 211.80. A break above these levels would confirm a double bottom near 207.00, signaling a potential trend shift. To the downside, initial support is seen at Friday's lows of 209.00, with deeper structural demand layers near the early October lows at 207.60 and the 207.00 area.