GBP/JPY Price Analysis:  Hits new three-week high as bulls target 186.00

• GBP/JPY's strong rally fueled by improved risk appetite and speculations on BoJ's policy stance.
• Technical analysis suggests a neutral to bullish trend; breaking 186.00 could lead to further gains towards 187.00 and 188.00.
• Downside risks for GBP/JPY include potential support at 184.30, 183.49 (Senkou Span B), and around 182.26/23.

The Pound Sterling (GBP) soared on Wednesday and posted gains of more than 1% against the Japanese Yen (JPY) as risk appetite improved ahead of the release of important economic data from the United States (US). That, alongside weaker economic data in Japan, decreased the likelihood that the Bank of Japan (BoJ) would normalize monetary policy. As Thursday’s Asian session begins, the GBP/JPY exchanges hands at 185.56, down by a minuscule 0.10%.

From a technical perspective, the GBP/JPY is neutral to bullish biased, but buyers must break the top of the Ichimoku Cloud (Kumo) at 186.00 to open the door for higher prices. Upside risks remain above 187.00, and on additional bullish strength, the next stop would be the 188.00 figure.

 If sellers regain control and keep the GBP/JPY below the 186.00 figure, they could remain hopeful of lower prices. Nevertheless, they must drag prices below the January 5 daily high turned support at 184.30, followed by the Senkou Span B at 183.49, ahead of the confluence of the Kijun and Tekan-Sen at around 182.26/23, respectively.

GBP/JPY Price Action – Daily Chart

GBP/JPY Technical Levels