July was a rough month for both the GBP and the JPY which were the worst performing currencies in the Major FX space against the Greenback (which also sparked a market-shaking comeback).
The past week however did see the return of some strength for the Yen after observing a lot of bad talk around the Nippon currency– As if bearish positioning for the Yen was at an extreme.
Positioning now seems more balanced as players have reduced their positions to prepare for tonight’s Bank of Japan Rate Decision.
No hike is expected but the BoJ tends to surprise markets so always stay ready, this one would shock the Trading World.
Markets are expecting a 25 bps rate cut from the upcoming Bank of England meeting on August 7.
The meeting will also see the release of the Quarterly Monetary Policy Report which will provide more details on the views from the UK Central Bank amid their ongoing Cut cycle – Cuts are currently priced in for one out of two meetings.
Taking a look at the GBPJPY Technicals
GBPJPY Daily
GBPJPY Daily Chart, July 30, 2025 – Source: TradingView
The most volatile FX pair has started to show some signs of retraction from its Range Extremes, right after reaching 199.976 (the pair did not breach the 200.00 level).
Momentum is actually starting to confirm a potential reversal around here with the RSI going towards bearish (still at a neutral level for now).
Expect whipsawing volatility between tonight’s BoJ Rate Decision and next week’s Bank of England meeting.
The most important aspect to spot is actually the confirmation of the range after bulls tried to break higher and saw some consequent sharp reversals.
Support Levels:
- 50 4H-MA 197.75 immediate support
- Intermediate Range Resistance Zone turned pivot near 196.00
- Range Intermediate Support Zone around the 190.00 level
Resistance Levels:
- Resistance Zone extremes 199.00 to 200.00
- Weekly highs 199.220
- 20 4H-MA 198.25
GBPJPY 4H
GBPJPY 4H Chart, July 30, 2025 – Source: TradingView
Looking closer to the 4H timeframe, we are spotting a trendline break-retest pattern.
This would be a decent sign of reversal if it wasn’t for the 4H 200-period MA holding prices – Therefore, keep this one closely in check to get a better idea of the immediate strength for bulls and bears.
With the MA 20 also passing as resistance, it will be interesting to see how the action reacts in the waiting of tonight’s BoJ Meeting.
GBPJPY 1H Chart
GBPJPY 1H Chart, July 30, 2025 – Source: TradingView
Looking even closer, we are seeing that the ongoing action is evolving within a downwards channel formed since the July 8th pivot.
The lower bound of the Channel is currently below 197.40 to 197.50 and its higher bound is around 198.90 – It would be uncommon to see any major breakout before tonight’s BoJ Meeting.
The pair will be extremely important to watch as European currencies start to show signs of weakness – Stay ready for the key Rate Decisions coming up soon.
Safe Trades and good luck for tonight’s Bank of Japan Meeting!