GBP/JPY tumbles to lows, eyeing monthly lows near 145.25 area
|The GBP/JPY cross faded upbeat UK retail sales-led bullish spike beyond the 146.00 handle and turned lower for the fourth consecutive session.
Barring an initial sharp reaction to the UK data, showing a stronger-than-expected rebound in consumer spending, the cross resumed with its corrective slide from closer to multi-month highs near the 147.60 region touched at the beginning of this week.
• UK: Warm weather gives retail sales a temporary boost - ING
Renewed concerns of a possible 'hard Brexit' scenario, following comments from the UK Trade Minister Liam Fox that the UK can survive with no Brexit deal, could have been the only factor weighing on the British Pound.
Meanwhile, the market seems to have largely ignored an offered tone surrounding the Japanese Yen, led by dovish BOJ decision to maintain status quo and prevalent risk-on environment, with broad based GBP weakness acting as an exclusive driver of the pair's sharp retracement back below mid-145.00s.
• BOJ: Risks to economy, prices are skewed to downside
The cross has now retreated over 80-pips from session tops and it would now be interesting to see bears maintain their upper hand or the cross once again catches some fresh bids at monthly lows support near 145.30-25 region.
Technical levels to watch
A follow through selling pressure below the mentioned lows support is likely to accelerate the fall below the key 145.00 psychological mark towards its next support near 144.60-55 region. On the flip side, any recovery back above 145.75 horizontal level could lift the cross back towards 146.25-30 supply zone.
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