- The GBP/JPY rises above the single mobile average (SMA) of 20 days, providing support in 194.21.
- The relative force index (RSI) is close to 60, suggesting that the impulse continues in favor of the bulls.
- A decisive rupture above 195.00 could push prices back to 196.00
The Japanese Yen (JPY) continues to weaken in front of the sterling pound (GBP) on Friday, with the GBP/JPY torque uploading about 195.20 at the time of writing.
This movement marks a continuation of the bullish impulse that began at the beginning of the week, since the par broke above the simple mobile average (SMA) of 20 days, pointing out a change in the feeling in the short term. Despite this fortress, the GBP/JPY is now testing a significant level of resistance that could determine the next directional trend.
The torque has found a firm resistance in 195.29, which corresponds to the fibonacci setback of 78.6% of the fall observed between January and April. This level has consistently limited the upward advances since the beginning of May, making it a critical technical barrier. However, impulse indicators suggest that bullies still have control.
The Relative Force Index (RSI) is around 60, showing that although the torque is not overcompared, there is still an ascending impulse that supports additional gains, provided that the resistance can be overcome decisively.
GBP/JPY DAILY GRAPH
Can the GBP/JPY recover 196.00?
If GBP/JPY achieves a daily closure above 195.29, the road could open towards the psychological level of 196.00, with the next potential levels of resistance around 197.30, which is aligned with the previous top. However, the lack of rapture of the current resistance could trigger a short -term setback.
Downwards, the psychological level of 194.00 offers initial support. This level is reinforced by the 20 -day SMA, which now acts as a dynamic support zone. A rupture below this area could expose deeper corrective objectives about 193.00, which is aligned with the 61.8% fibonacci setback in 192.97. Higher bearish pressure could carry the 200 -day SMA about 192.80 to the focus, a level that could serve as a more significant support zone.
LIBRA ESTERLINA FAQS
The sterling pound (GBP) is the oldest currency in the world (886 AD) and the official currency of the United Kingdom. It is the fourth most commercialized currency exchange unit (FX) in the world, representing 12% of all transactions, with an average of $ 630 billion a day, according to data from 2022. Its key commercial peers are GBP/USD, which represents 11% of FX, GBP/JPY (3%) and EUR/GBP (2%). The sterling pound is issued by the Bank of England (BOE).
The most important factor that influences the value of sterling pound is the monetary policy decided by the Bank of England. The Bank of England bases its decisions itself has achieved its main objective of “price stability”: a constant inflation rate of around 2%. Its main tool to achieve this is the adjustment of interest rates. When inflation is too high, the Bank of England will try to control it by raising interest rates, which makes access to credit for people and companies more expensive. This is generally positive for sterling pound, since higher interest rates make the United Kingdom a more attractive place for global investors to invest their money. When inflation falls too much it is a sign that economic growth is slowing down. In this scenario, the Bank of England will consider lowering interest rates to reduce credit, so that companies will borrow more to invest in projects that generate growth.
Published data measure the health of the economy and can affect the value of sterling pound. Indicators such as GDP, manufacturing and services PMI and employment can influence the direction of the sterling pound.
Another important fact that is published and affects the pound sterling is the commercial balance. This indicator measures the difference between what a country earns with its exports and what you spend on imports during a given period. If a country produces highly demanded export products, its currency will benefit exclusively from the additional demand created by foreign buyers seeking to buy those goods. Therefore, a positive net trade balance strengthens a currency and vice versa in the case of a negative balance
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
