GBP/JPY Price Analysis: Looks south on the negative divergence of key indicators

• GBP/JPY is sidelined in Asia near 141.45 versus, having faced rejection at 142.00 on Monday. 
• Bearish divergences of key 4-hour chart indicators show scope for a deeper pullback. 

GBP/JPY is trading mostly unchanged on the day near 141.45 at press time. 

The 4-hour chart shows a bearish divergence of the relative strength index. A bearish divergence occurs when the indicator charts lower highs, contradicting higher highs on prices and is indicative of uptrend exhaustion. 

The slow stochastic indicator on the 4-hour chart has also diverged in favor of the bears. 

As such, the pair could witness a pullback to the psychological support of 141.00, which, if violated, would shift the focus to the 10-day simple moving average, currently at 139.97. On the higher side, key levels to watch out for are 141.75 (Asian session high) and 142.00. 

4-hour chart

Trend: Pullback likely

Technical levels