- GBP/JPY extends Tuesday’s pullback from one-week high.
- Covid woes, reflation worries weigh on market sentiment.
- Japan Reuters-Tankan survey came out positive, UK CPI can exert fresh pressure on BOE policymakers to turn hawkish.
- Japan Industrial Production, Brexit also become the key.
GBP/JPY takes offers around 152.70, down 0.10% intraday, amid Wednesday’s Asian session. That said, the cross-currency pair refreshes the day’s low, also extending the previous day’s losses, by the press time.
Downbeat market sentiment, recently due to the coronavirus (COVID-19) woes and reflation fears, seem to weigh on the quote. Also on the negative side could be the cautious sentiment ahead of the key UK data as well as the Brexit drama.
The UK reports the highest death toll since April and The Sun came out with the note, quoting British experts to say, “Britain could be back in lockdown in just 11 weeks as cases spiral just as restrictions are eased.” On the other hand, Brexit jitters continue weighing on the government bills as The Times said, “Government legal bills have surged to a four-year high, with Brexit driving a billing bonanza for City law firms advising Whitehall.” Also portraying the Brexit drama could be the latest comments from the BOE Governor suggesting no room for the UK financial services in the European Union (EU).
Elsewhere, Japan fears supply-chain disruptions due to the covid resurgence in countries as Malaysia and Indonesia, per Kyodo news. The Asian major already gets heavily criticized for holding the Olympics when the nation suffers from the pandemic.
On the positive side, the Reuters-Tankan survey for June 30 to July 09 period suggests, “Japanese manufacturers’ business confidence rose in July to hit a more than two-and-a-half-year high.”
Amid these plays, markets sentiment remains subdued with the US 10-year Treasury yields probing a three-day uptrend and the S&P 500 Futures staying around record top.
Moving on, Japan Industrial Production for May, expected to remain unchanged at 22.0%, may offer immediate direction to GBP/JPY ahead of the UK Consumer Price Index (CPI) for June, forecast 2.2% versus 2.1%. Given the hopes of increased price pressure in the British economy, the BOE may have to reconsider the recently cautious outlook, which in turn could propel the GBP/JPY prices. However, risk catalysts like Brexit and covid become more important to watch for near-term direction.
GBP/JPY pair’s sustained trading below 153.35-40 resistance confluence, comprising 21-day SMA and a three-week-old falling trend line, keeps sellers hopeful of breaking the 100-day SMA support of 152.40.
Additional important levels
|Today last price||152.69|
|Today Daily Change||-0.16|
|Today Daily Change %||-0.10%|
|Today daily open||152.85|
|Previous Daily High||153.49|
|Previous Daily Low||152.42|
|Previous Weekly High||154.08|
|Previous Weekly Low||150.67|
|Previous Monthly High||155.94|
|Previous Monthly Low||151.32|
|Daily Fibonacci 38.2%||152.83|
|Daily Fibonacci 61.8%||153.08|
|Daily Pivot Point S1||152.35|
|Daily Pivot Point S2||151.85|
|Daily Pivot Point S3||151.28|
|Daily Pivot Point R1||153.42|
|Daily Pivot Point R2||153.99|
|Daily Pivot Point R3||154.49|
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.