GBP/JPY technical analysis: Trading in the red, but bearish momentum weakening

• GBP/JPY’s daily chart shows bullish MACD histogram divergence
• Daily chart RSI is reporting oversold conditions. 

GBP/JPY is currently trading on the defensive around 138.75, having hit a high of 139.64 on Monday.

The moving average convergence divergence (MACD) histogram has formed higher lows below zero line over the last ten days, contradicting the lower lows on the price chart. 

That bullish divergence indicates loss of bearish momentum or seller exhaustion. 

The 14-day relative strength index (RSI) of 24.72 is also reporting oversold conditions. 

So, an oversold bounce to levels above 139.00 cannot be ruled out. 

Daily chart

Trend: Seller exhaustion