GBP/JPY Price Forecast: Clings to gains above 208.00; bearish bias intact ahead of BoE/BoJ

The GBP/JPY currency pair maintained its upward momentum above the 208.00 mark at the beginning of a new week, trading within a range of 208.25-208.30 throughout the first half of the European session. However, prices are still near the year-to-date low, which was reached last Tuesday, as traders await crucial central bank announcements.

The Bank of England (BoE) is set to release its decision on Wednesday, followed by the Bank of Japan (BoJ) meeting on Friday. The BoE is expected to keep interest rates unchanged, while traders have already priced in a 25 basis points (bps) increase from the BoJ. Focus will now shift towards the future policy trajectory, which could potentially provide a boost to the GBP/JPY pair.

Currently, the price action is below the 200-day Simple Moving Average (SMA) and the 23.6% Fibonacci retracement level from the April 2025-July 2026 rally. The Moving Average Convergence Divergence (MACD) indicator is negative, and the Relative Strength Index (RSI) sits near 30, indicating ongoing downside pressure despite a developing oversold condition.

A move above the 23.6% retracement level at 211.38 could signal improved sentiment, but a sustained breakthrough of the 200-day SMA at 213.11 would be required to shift the current bearish bias. On the downside, support can be found at the 38.2% Fibonacci retracement near 206.24, followed by the 50% retracement at 202.08. A deeper decline would expose the 61.8% retracement at 197.93 and the 78.6% level at 192.01, before reaching the broader swing low of 184.47.