GBP/JPY Price Analysis: Bearish head & shoulders pattern spotted on hourly charts

• GBP/JPY retreats further from two-week tops set on Wednesday.
• The technical set-up now seems tilted in favour of bearish traders.

The GBP/JPY cross edged lower on Thursday and retreated further from near two-week tops set in the previous session. Despite the pullback, the cross has managed to defend 200-hour SMA support.

Looking at a broader perspective, the cross seemed to have formed a bearish head & shoulders pattern on hourly charts. The neckline coincides with the above-mentioned support, around the 142.30-25 region.

Given that oscillators on 4-hourly/daily charts have been struggling to gain any meaningful traction, a sustained break through might now be seen as a key trigger for short-term bearish traders.

The cross might then turn vulnerable to break below the 142.00 round-figure mark and aim towards testing the recent daily closing lows support near the 141.25 – also the measured target for the bearish pattern.

On the flip side, the 142.75-80 region now seems to act as an immediate resistance, which if cleared might negate the bearish set-up and lift the cross back towards the 143.25-35 supply zone.

GBP/JPY 1-hourly chart