GBP/JPY plunges from 169.50 area to session lows below 165.00

The pound retreats to levels below 165.00 on an alleged BoJ intervention.
The Japanese authorities have declined any comment.
FX analysts are skeptical about the effectiveness of monetary interventions.

Guillermo Alcala FXStreet

The British pound has depreciated more than 2.5% in a few minutes during Friday's US trading session in what seems like an intervention by the Japanese authorities to protect the yen.

The GBP/JPY was trading at 169.50, at a short distance to a six-year high of 170.25 before plummeting to session lows at 164.70. The pound’s bearish reversal has lacked any fundamental catalyst, and all signs point out to an alleged action by the Bank of Japan and the Ministry of Finance.

The Japanese Ministry of Finance has declined to comment on the issue.

Earlier during the week, however, BoJ officials and Japanese authorities reiterated their commitment to step in to curb yen volatility. On Friday, Finance minister Suzuki affirmed that Japanese authorities were dealing with currency speculators “strictly”.

On Thursday, Masato Kanda, Japan’s vice minister of finance for international affairs assured that the Japanese Government is ready to take action “as excessive volatility becomes increasingly unacceptable.”

Currency analysts are doubtful about the effectiveness of such actions while the fundamental reasons are adverse. The monetary policy differential between a hawkish Federal Reserve and the ultra-accommodative Bank of Japan is clearly favorable to the US dollar.

Technical levels to watch

GBP/JPY

Overview
Today last price	165.55
Today Daily Change	-3.09
Today Daily Change %	-1.83
Today daily open	168.64

Trends
Daily SMA20	162.64
Daily SMA50	162.82
Daily SMA100	163.55
Daily SMA200	161.07

Levels
Previous Daily High	169.74
Previous Daily Low	167.42
Previous Weekly High	167.29
Previous Weekly Low	159.73
Previous Monthly High	167.22
Previous Monthly Low	148.8
Daily Fibonacci 38.2%	168.85
Daily Fibonacci 61.8%	168.31
Daily Pivot Point S1	167.47
Daily Pivot Point S2	166.29
Daily Pivot Point S3	165.16
Daily Pivot Point R1	169.78
Daily Pivot Point R2	170.91
Daily Pivot Point R3	172.09

Author

Guillermo Alcala

FXStreet

Graduated in Communication Sciences at the Universidad del Pais Vasco and Universiteit van Amsterdam, Guillermo has been working as financial news editor and copywriter in diverse Forex-related firms, like FXStreet and Kantox.

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