GBP/JPY tumbles to one-month lows near 143.00 handle and rebounds
|The GBP/JPY cross finally broke out of its two-day old trading range and tumbled to one-month lows before recovering few pips to currently trade around mid-143.00s.
Today's release of Japanese national CPI, recording gains for the fourth consecutive month, convinced markets that inflation is picking up in Japan and lifted the domestic currency. This coupled with a possible disappointment from the major oil producers meeting on Thursday triggered a fresh wave of global risk-aversion trade and provided an additional boost to the Japanese Yen's safe-haven appeal.
Meanwhile, the prevalent bearish sentiment surrounding the British Pound, against the backdrop of yesterday's disappointing UK GDP growth numbers that compounded concerns over the impending Brexit negotiations, further collaborated to the heavily offered tone surrounding the cross.
• UK: Problems in the household consumption pattern – Deutsche Bank
With today's slide to the lowest level since April 27, the cross is headed for its lowest weekly close in the past four weeks and hence, a follow a follow through weakness in the near-term now seems a distinct possibility.
With an empty UK economic docket, broader market risk sentiment would remain an exclusive driver of the pair's movement through the last trading day of the week.
Technical levels to watch
Weakness below the 143.00 handle is likely to accelerate the slide towards 142.65 region, which is closely followed by support near 142.35-30 area. On the upside, recovery move beyond 143.60 level now seems to confront strong hurdle near 144.00-10 area, above which a bout of short-covering could lift the cross towards 144.55-60 horizontal resistance.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.