GBP/JPY recovers from lows to climb back above 191.00
- Guppy recovers near-term after drop into 190.40.
- Thin data leaves the Pound Sterling exposed to further downside.
- Coming up this week: UK PMIs, Japanese Tokyo CPI inflation.
The GBP/JPY pair backslid into familiar lows near 190.40 as Pound Sterling (GBP) traders continue to look out for multiple rate cuts from the Bank of England (BoE) in 2024. Interest rate futures are currently pricing in a first cut from the UK’s central bank in July of this year, with at least two follow-up rate trims expected before the end of the year. Rate futures markets previously anticipated two cuts total in 2024, with the first initially pegged for August.
The S&P Global Purchasing Managers Indexes for the UK in April are slated to print early in the Tuesday market session. Markets anticipate a steady hold at 50.3 in the Manufacturing component. The Services component is expected to ease, albeit slightly, to 53.0 from 53.1.
Japan’s Tokyo Consumer Price Index (CPI) will print early Friday, with investors expecting YoY Tokyo CPI inflation to hold steady at 2.6%. The Bank of Japan’s (BoJ) latest Monetary Policy Statement will also occur sometime early Friday, with the BoJ’s Outlook Report for the first quarter expected around 03:00 GMT.
GBP/JPY technical outlook
The Guppy’s chart churn continues, with notable GBP weakness poking through. A near-term floor has been priced in near 190.40, with a heavy congestion zone built into the charts between 192.80 and 192.00.
Longer-term, the GBP/JPY pair is resting on the high end of an extremely bullish run up the charts. The pair trades well above the 200-day Exponential Moving Average (EMA) at 184.82, and the Guppy is sticking close to nine-year highs set in March above 192.50.
GBP/JPY hourly chart
GBP/JPY daily chart
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.
