- In the overnight session, the GBP/JPY tumbled near 4.50% on concerns over the UK budget.
- The GBP/JPY pierced the 20 and 50-Week EMAs, hoovering around the 100-Week EMA.
- GBP/JPY Price Analysis: Shifted bearish biased, as it broke below the 200-EMA, eyeing a re-test of the YTD low around 148.00.
The GBP/JPY drops as the New York session is about to finish, though recovered after printing a fresh one-year low at around 148.63, on Increasing concerns that the UK’s new budget would likely add to the country’s inflationary pressures amidst the Bank of England’s tightening cycle to quell inflation from double-digit levels. At the time of writing, the GBP/JPY is trading at 154.56, still below its opening price.
GBP/JPY Price Analysis: Technical outlook
The GBP/JPY weekly chart portrays the cross tumbled below the 20, 50, and 100-Week EMAs, though the pair trimmed some of its losses and is back above the 154.80 mark. Oscillators, mainly the Relative Strength Index (RSI), shifted negatively, showing the Japanese FX intervention’s impact alongside the UK’s slowing economic outlook. If the GBP/JPY registers a decisive break below the 100-WEMA at 153.52, that could pave the way for further losses. Otherwise, expect the cross-currency to stay range-bound in the 153.50-158.56 range.
From a daily chart perspective, the GBP/JPY shifted bearish biased once sellers hurdled the 200-day EMA, which, at the time of typing, stands at 160.27, opening the door for further losses. GBP/JPY traders should be aware that the Relative Strength Index (RSI) plunged to oversold levels at 24, which could impede sellers from taking action. Indeed, once the RSI exits from those levels, traders should expect a resumption of the downtrend, targeting the fresh YTD low at 148.53, which could extend towards the September 2020 cycle high of 142.70.
GBP/JPY Key Technical Levels
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. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD faces a minor resistance near at 1.0750
EUR/USD quickly left behind Wednesday’s small downtick and resumed its uptrend north of 1.0700 the figure, always on the back of the persistent sell-off in the US Dollar ahead of key PCE data on Friday.
GBP/USD returns to 1.2500 area in volatile session
GBP/USD reversed its direction and recovered to 1.2500 after falling to the 1.2450 area earlier in the day. Although markets remain risk-averse, the US Dollar struggles to find demand following the disappointing GDP data.
Gold holds around $2,330 after dismal US data
Gold fell below $2,320 in the early American session as US yields shot higher after the data showed a significant increase in the US GDP price deflator in Q1. With safe-haven flows dominating the markets, however, XAU/USD reversed its direction and rose above $2,340.
Bitcoin price continues to get rejected from $65K resistance as SEC delays decision on spot BTC ETF options
Bitcoin (BTC) price has markets in disarray, provoking a broader market crash as it slumped to the $62,000 range on Thursday. Meanwhile, reverberations from spot BTC exchange-traded funds (ETFs) continue to influence the market.
US economy: slower growth with stronger inflation
The dollar strengthened, and stocks fell after statistical data from the US. The focus was on the preliminary estimate of GDP for the first quarter. Annualised quarterly growth came in at just 1.6%, down from the 2.5% and 3.4% previously forecast.