GBPJPY – British Pound Looks Set To Gain Further Pace
Aayush Jindal
GBPJPY – British Pound Looks Set To Gain Further Pace
Key Highlights
The British Pound traded higher recently versus the Japanese yen and may continue to gain pace.
There is a crucial ascending channel pattern formed on the 4-hours chart of the GBPJPY pair, which is helping buyers.
The Japanese Industrial Production preliminary report was released by the Ministry of Economy, Trade and Industry earlier today.
It posted no change in July 2016, compared with the forecast of an increase 0.8%.
GBPJPY Pair Technical Analysis
The British Pound after testing the 129.00 support zone versus the Japanese yen traded higher and recovered well. It looks like the GBPJPY pair may continue to head higher in the near term.As mentioned, there is a crucial ascending channel pattern formed on the 4-hours chart of the GBPJPY pair. It is acting as a catalyst for the current bullish trend and helping buyers. However, on the upside, there is a major resistance near the 200 simple moving average, which is also around the 50% Fib retracement level of the drop from the 139.91 high to 129.07 low.The GBP pair may correct a few pips in the near term, but the channel support may come into play in that case to protect a downside break.
Japanese Industrial Production
Today in Japan, the Industrial Production, which measures outputs of the Japanese factories and mines was released by the Ministry of Economy, Trade and Industry.The market was expecting an increase of 0.8% in July 2016, compared with the previous month (preliminary reading). However, the outcome was lower, as there was no change in July 2016. In terms of the yearly change, the Japanese Industrial Production posted a decline of 3.8%.
UK Nationwide Housing Prices
Today in the UK, the Nationwide Housing Prices, which shows the value of the houses prices in UK and indicate current movements in the housing market will be released. It is considered as an important factor to the UK's economy and if forecasted to post a decline of 0.3% in August 2016, compared with the previous month in which there was a rise of 0.5%.In terms of the yearly change, the Nationwide Housing Prices is forecasted to increase by 4.5%, less than the last reading of 5.2%. The outcome may impact the British Pound in the short term, but it should be limited.
As mentioned, there is a crucial ascending channel pattern formed on the 4-hours chart of the GBPJPY pair. It is acting as a catalyst for the current bullish trend and helping buyers. However, on the upside, there is a major resistance near the 200 simple moving average, which is also around the 50% Fib retracement level of the drop from the 139.91 high to 129.07 low.The GBP pair may correct a few pips in the near term, but the channel support may come into play in that case to protect a downside break.