GBP/JPY Price Analysis: Pair struggles to snap recent losses, trades below 184.00

• GBP/JPY holds ground near 183.80 due to downbeat Japan’s inflation data.
• Weekly low appears to be the support following 38.2% Fibo.
• The cross could face a barrier around 184.00 psychological level.

GBP/JPY struggles to snap three-day losses, currently trading around 183.80 lined up with the 21-day Exponential Moving Average (EMA) during the European session on Friday. The cross experiences upward pressure due to downbeat Japan’s inflation data.

Tokyo Consumer Price Index (CPI) (YoY) declined to 2.9% in the month of August against the 3.0% expected, from the 3.2% prior. Tokyo CPI ex Food, Energy (YoY) remains unchanged at 4%, while Tokyo CPI ex Fresh Food (YoY) fell to 2.8% from the 3% figure in July, slightly lower than the market expectations of 2.9%.

The pair could meet support around the weekly low at 183.35, following the 38.2% Fibonacci retracement at 182.78 level. A firm break below the latter could open the doors for the GBP/JPY pair to navigate the region around the 50-day EMA at 181.61 level.

On the upside, the 184.00 psychological level appears to be the key resistance. A break above that level could support the pair to explore the area around nine-day EMA at 184.52.

The 14-day Relative Strength Index (RSI) remains below 50, which suggests a bearish bias of the GBP/JPY traders. The Moving Average Convergence Divergence (MACD) line stays above the centerline but lies below the signal line, which suggests that recent momentum is weaker.

GBP/JPY: Daily Chart