GBP/JPY: worst decline in a month

Matías Salord FXStreet

GBP/JPY is about to end on Monday with the biggest decline since late February. The pair made an important retracement after posting on Friday the highest daily close in weeks.

Last week, it traded above 140.00 but it failed to hold. Today during the Asian session it approached that level but after reaching 139.90 it lost strength and started to decline. After falling below 138.90 it accelerated the decline and bottomed during the US session at 138.28.

Near the end of the day, it was hovering around 138.35/40, slightly above daily lows, still under pressure. GBP/JPY went from trading above an important short-term trendline, to approach the important 138.00 handle.

JPY stronger, GBP weaker

The pound weakened during the European session after the release of the PMI Manufacturing report for the UK. The index fell to 54.2, the lowest in four months. It represented a decline from the 54.5 reading in February and below the 55.0 of market consensus.

On the opposite direction, the Japanese yen strengthened during the American session on the back of a rally in US bonds and a decline in equity prices. The risk-off environment contributed to the continuation of the slide of the GBP/JPY pair.

Author

Matías Salord

FXStreet

Matías started in financial markets in 2008, after graduating in Economics. He was trained in chart analysis and then became an educator. He also studied Journalism. He started writing analyses for specialized websites before joining FXStreet.

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