untitled design

GBP/JPY recovers to multi-week highs above 163.35 on JPY weakness

  • GBP/JPY is posting solid gains of almost 1.80% for the week.
  • An upbeat market mood increased appetite for riskier assets.
  • GBP/JPY Price Forecast: Test Apr 28 swing high above 164.00.

GBP is rising to fresh multi-week highs on Thursday, up 1.78% and targeting 164.00 amid improving market sentiment. US stocks are recovering from earlier losses, and safe-haven pairs are under downward pressure. At 163.34, the GBP/JPY rises strongly for the seventh day in a row.

GBP/JPY rises on JPY weakness

The pound remains strong during the day, despite the fact that the UK is on holiday to celebrate the Queen’s Jubilee. High inflation in the UK, around 9%, about to print double digits, and slowing economic growth, would keep the GBP vulnerable to further selling pressure. However, it was helped by the yen, affected by the Bank of Japan’s (BoJ’s) ultra-dovish monetary policy stance, despite the fact that the country’s inflation reached 2%.

In the Asian session, BoJ board member Adachi said that trying to strengthen a weaker yen by tightening monetary policy would mean reducing corporate funding. Adachi said that if the Fed’s rate hike cycle cools the US economy, there is a risk that the depreciation of the Japanese yen could be reversed.

Meanwhile, the absence of the UK economic docket had GBP/JPY traders leaning towards a market sentiment game. As for the Japanese calendar, around 12:30 GMT, the Jibun Bank Services and Composite PMIs should shed some light on the Japanese economy.

GBP/JPY Price Forecast: Technical Outlook

Thursday’s GBP/JPY price action shows resistance from GBP bulls, which pushed the British pound for the seventh consecutive session towards fresh daily highs. In fact, the currency cross is trading at four-week highs, so it would be facing strong resistance, which is to blame for the drop from 164.25 to 155.58.

This would indicate that the GBP/JPY is about to top out. However, the Relative Strength Index (RSI) at 58.90 points higher, so a move towards the 28th April high at 164.25 is on the cards.

Therefore, the first resistance of the GBP/JPY would be the daily high of May 5 at 163.57. A break of the latter would expose the May 2 high at 163.89, followed by 164.00 and then the aforementioned 164.25, the April 28 high.

Technical levels

GBP/JPY

Panorama
Last Price Today 163.24
Today’s Daily Change 0.78
Today’s Daily Change % 0.48
Today’s Daily Opening 162.46
Trends
20 Daily SMA 160.12
50 Daily SMA 161.77
100 Daily SMA 158.51
200 Daily SMA 155.78
levels
Previous Daily High 163.33
Previous Daily Minimum 161.97
Previous Maximum Weekly 161.03
Previous Weekly Minimum 158
Monthly Prior Maximum 163.91
Previous Monthly Minimum 155.6
Daily Fibonacci 38.2% 162.81
Daily Fibonacci 61.8% 162.49
Daily Pivot Point S1 161.85
Daily Pivot Point S2 161.23
Daily Pivot Point S3 160.49
Daily Pivot Point R1 163.2
Daily Pivot Point R2 163.94
Daily Pivot Point R3 164.56

Source: Fx Street

You may also like

Get the latest

Stay Informed: Get the Latest Updates and Insights

 

Most popular