GBP/JPY tests nine-year highs around 190.00

GBP/JPY briefly touched 190.00 as the GBP lifts against the Yen.
UK Unemployment Rate declined more than expected.
UK CPI inflation slated for Wednesday.

Joshua Gibson FXStreet

GBP/JPY briefly tested the 190.00 major price handle on Tuesday as the Pound Sterling (GBP) rose across the broader FX market, bolstered by a better-than-expected Unemployment Rate print and easing wage growth figures helping to quell inflation fears.

UK Average Earnings (including bonuses) fell to 5.8% for the annualized quarter ended in December versus the forecast 5.6%, down from the previous period’s 6.7% (revised from 6.5%). Wage growth declined less than expected, but easing earnings growth is helping to squelch ongoing inflation fears in the UK.

The UK ILO Unemployment Rate for the quarter ended in December ticked down to 3.8% versus the forecast 4.0%, down even further from the previous quarter’s 4.2%. Money markets have reduced their bets of a June 25 basis point cut from the Bank of England down to 60% on Tuesday, down from the 75% prior to the economic figure prints.

Wednesday sees a slew of UK inflation figures, including headline Consumer Price Index (CPI) inflation that is expected to slide to -0.3% for January compared to the previous month’s 0.4%. The headline CPI print for the year ended in January is forecast to tick upwards to 4.2% from 4.0%.

Early Thursday also sees Japan’s latest Gross Domestic Product (GDP) update, which is expected to rebound to 0.3% for the fourth quarter compared to the previous quarter’s -0.7%.

Japan’s GDP print will be followed up by the UK’s own GDP release later on Thursday. UK GDP growth is expected to hold steady at a contractionary -0.1%.

GBP/JPY technical outlook

GBP/JPY surged 0.6% on Tuesday, testing the 190.00 major handle and extending the pair into a fifth straight day of gains after finding a tentative floor near 185.23. The pair has risen nearly 6% since seeing a bullish rejection from the 200-day Simple Moving Average (SMA) near 179.00.

The GBP/JPY is struggling to push decidedly over the 190.00 handle, and a fresh data-driven bullish push could be necessary to avoid a bearish turnaround back into the 188.00 handle.

GBP/JPY hourly chart

GBP/JPY daily chart

GBP/JPY

Overview
Today last price	189.83
Today Daily Change	1.24
Today Daily Change %	0.66
Today daily open	188.59

Trends
Daily SMA20	187.54
Daily SMA50	184.38
Daily SMA100	184.22
Daily SMA200	182.2

Levels
Previous Daily High	188.72
Previous Daily Low	187.86
Previous Weekly High	188.87
Previous Weekly Low	186.18
Previous Monthly High	188.94
Previous Monthly Low	178.74
Daily Fibonacci 38.2%	188.39
Daily Fibonacci 61.8%	188.19
Daily Pivot Point S1	188.06
Daily Pivot Point S2	187.53
Daily Pivot Point S3	187.2
Daily Pivot Point R1	188.92
Daily Pivot Point R2	189.25
Daily Pivot Point R3	189.79

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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