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The GBP/JPY pair declined by 0.21% during the North American session as the British pound weakened despite the Bank of England maintaining its interest rates. The cross is currently trading at 213.11, having previously reached 214.06. Technical analysis highlights the 100-day simple moving average (SMA) as a critical level, with sellers closely monitoring a potential breakdown below this key support. A sustained move below the 100-day SMA could signal further bearish momentum, potentially testing lower support levels around 210.00.
For traders, the 100-day SMA is a vital technical benchmark. A confirmed breakdown could trigger increased selling pressure, especially if the BoE signals future rate cuts. This development might also influence broader GBP cross pairs, given the pound's sensitivity to UK monetary policy. Retail traders should watch for volume patterns and candlestick formations near the SMA to assess the strength of the breakdown.
Looking ahead, GBP/JPY's trajectory will depend on BoE's policy direction and broader GBP/USD dynamics. If the BoE remains dovish, the pair could face further downward pressure. Traders should also monitor Japanese Yen movements against the US Dollar, as Yen strength could amplify GBP/JPY's decline. Key levels to watch include the 210.00 psychological threshold and the 205.00 support zone.
