• GBP/JPY holds lower ground near 100-SMA support, down for the second consecutive day.
• Downbeat MACD signals, RSI (14) add strength to the bearish bias.
• Five-week-old descending resistance line holds the key to buyer’s conviction.

GBP/JPY fades the late Tuesday’s corrective bounce off the 100-bar Simple Moving Average (SMA) as it prints mild losses near the 160.00 psychological magnet during early Wednesday. In doing so, the cross-currency pair keeps the previous week’s retreat from a one-month high.

Not only the failure to defend the bounce off 100-SMA but bearish MACD signals and downbeat RSI (14), not oversold, also keeps GBP/JPY bears hopeful.

However, a clear downside break of the stated SMA level surrounding 159.70 becomes necessary for the GBP/JPY bears.

Following that, the January 19 swing low near 157.60 could act as a buffer during the fall targeting the previous monthly low of 155.36. It should be noted that May 2022 low near 155.60 also challenges the short-term GBP/JPY bears.

Meanwhile, recovery moves may aim for the latest peak surrounding 161.45 before approaching a downward-sloping resistance line from late December 2022, close to 161.65 at the latest.

In a case where the quote rises past 161.65, the 50% Fibonacci retracement of GBP/JPY downbeat between late 2022 and early January 2023, around 162.30, could act as the last defense of the bears.

To sum up, GBP/JPY is likely to remain bearish even if the 100-SMA challenges the immediate downside.

GBP/JPY: Four-hour chart

Trend: Further downside expected