GBPJPY is trending higher on its hourly time frame, with a rising trend line connecting its lows since the first week of February. Price is in the middle of a correction and might gather more buyers at the Fibonacci retracement levels.

The 61.8% Fibonacci level lines up with the trend line support and 100 SMA dynamic inflection point, which might be a prime spot for buyers to enter. However, the 50% level already seems to be holding as a floor at the moment.

If this is enough to keep losses in check, GBPJPY could resume the climb to the swing high around the 166.00 major psychological mark or higher.

The 100 SMA is above the 200 SMA to confirm that the uptrend is more likely to resume than to reverse. Also, stochastic is already on the move up to show that bullish momentum is already in play. RSI is pulling higher as well, so the pair could follow suit until overbought conditions are met.

There are no major reports from both the UK and Japan this week, so market sentiment might be the main driving factor for this pair. Geopolitical tensions might keep a lid on risk rallies, but increased focus on China’s reopening and economic rebound could support risk-on flows.

Also, it’s worth noting that the next BOJ head is in favor of continuing the central bank’s easy monetary policy and low interest rate regime. This is in contrast to previous speculations that he could end the yield curve control policy soon and allow the yen to appreciate.

Meanwhile, PMI readings from the UK released last week revealed that the manufacturing and services sectors are doing better than expected, leading to stronger speculations of more BOE rate hikes.