GBP/JPY Price Forecast: Potential double top at the 196.40 area

• The Pound extends losses with the Yen favoured by risk aversion.
• BoJ's Ueda has kept hopes of further interest rate rises alive.
• GBP/JPY approaches a key support area at 192.00.

The Pound is trading lower for the fourth consecutive day against a stronger Yen, favoured by the frail market sentiment, and hawkish comments by BoJ Governor Ueda, which keep hopes of further rate hikes alive.

The BoJ's chief warned about trade uncertainty but maintained that the bank will continue raising rates if the economic expectations are met. Ueda also observed the tight labour market that pushes wages higher and stated that Japan's real interest rate remains deeply negative, all in all, a hawkishly-leaning message.

Technical analysis: The 192.00 area is a key support level

The Sterling reversed course last week, after rejection at 196.30, a few pips below the May 13 and 14 highs, and has traded lower ever since. Intraday studies are well into negative territory, and the pair approaches the 192.00 area, which is the neckline of a double top at the mentioned levels.

A successful breach of this level would confirm a deeper correction after the April-May rally, bringing the 190.30 level into focus. The Double tpop's measured target is 187.50.

On the upside, resistances are at 194.50 and the mentioned tops at the 196.30-193.40 area.

GBP/JPY 4-Hour Chart