GBP/JPY rebounding in broad-market recovery despite UK Retail Sales miss

The GBP/JPY has rebounded back towards 186.50 after sinking post-UK Retail Sales slide.
Investor sentiment is seeing a bounce heading into the Friday close, dragging the GBP back up.
With UK data continuing to miss the mark, downside risks remain for the Pound Sterling.

Joshua Gibson FXStreet

The GBP/JPY plummeted below 185.50 in Friday trading after UK Retail Sales broadly missed market forecasts, sending the Pound Sterling (GBP) tumbling, but a midday recover in broad-market risk appetite is seeing the Guppy pare back some of the day's losses as safe havens like the Yen (JPY) get pushed back down.

Retail Sales miss the mark, Japan Machinery Orders rebound

UK Retail Sales declined 0.3% month-on-month in October, completely missing the market's forecast 0.3% increase despite a recovery from September's -1.1%, which was also revised lower from -0.9%.

Annualized Retail Sales also worsened, with the year into October printing at -2.7%, significantly worse than the market's expected -1.5% and accelerating a decline from September's figure of -1.0%.

Early Friday also saw Japanese Machinery Orders improve, with the MoM figure for September improving by 1.4%, over the market's expected 0.9% and chewing through the previous month's 0.5% decline.

Japan's Merchandise Trade Balance Total in October also cleared expectations, but still came in sharply down from September's ¥72.1 billion, falling to ¥-662.5 billion instead of the median forecast of ¥-735.7 billion.

GBP/JPY Technical Outlook

Friday's decline sees the GBP/JPY tussling with the 200-hour Simple Moving Average (SMA) for the first time in three weeks as bids collapse back into the midrange, and the near-term expectancy for the pair could be threatening a tilt towards the downside as intraday swing lows steepen.

Daily candlesticks show the GBP/JPY remains firmly entrenched in bullish territory, but pushes towards the high side have been limited as 2023's year-long rally appears to be running out of gas. Congestion around familiar price levels has been increasing and the pair spent most of September and October trapped below the 50-day SMA.

GBP/JPY Hourly Chart

GBP/JPY Daily Chart

GBP/JPY Technical Levels

GBP/JPY

Overview
Today last price	186.37
Today Daily Change	-0.68
Today Daily Change %	-0.36
Today daily open	187.05

Trends
Daily SMA20	184.31
Daily SMA50	183.12
Daily SMA100	183.12
Daily SMA200	175.8

Levels
Previous Daily High	188
Previous Daily Low	186.83
Previous Weekly High	185.97
Previous Weekly Low	184.55
Previous Monthly High	184.33
Previous Monthly Low	178.08
Daily Fibonacci 38.2%	187.28
Daily Fibonacci 61.8%	187.55
Daily Pivot Point S1	186.59
Daily Pivot Point S2	186.12
Daily Pivot Point S3	185.42
Daily Pivot Point R1	187.75
Daily Pivot Point R2	188.46
Daily Pivot Point R3	188.92

Author

Joshua Gibson

FXStreet

Joshua joins the FXStreet team as an Economics and Finance double major from Vancouver Island University with twelve years' experience as an independent trader focusing on technical analysis.

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