- GBP / JPY witnessed some profit taking from 154.00, or three-year highs.
- Risk aversion benefited the JPY safe haven and put some downward pressure.
- The optimistic UK economic outlook supported the British pound and helped limit deeper losses.
The crossing GBP/JPY it reversed a drop at the beginning of the North American session to 153.00 and was last seen trading in neutral territory, around 153.50.
The cross struggled to capitalize on the previous day’s strong positive move to more than three-year highs and witnessed a modest intraday pullback from 154.00. A sharp decline in global equity markets forced investors to take refuge in the traditional Japanese yen. This, in turn, was seen as a key factor that triggered some profit-taking around the GBP / JPY pair.
That said, the decline remains muffled amid growing optimism about the UK’s economic recovery from the pandemic. A sharp drop in COVID-19 deaths and new cases enabled UK Prime Minister Boris Johnson to confirm the next stage of relief from the lockdown in England. This, coupled with the diminishing risk of an impending Scottish referendum on independence, acted as a tailwind for the British pound.
Furthermore, investors also seemed reluctant to make aggressive bets, preferring to wait for the speech scheduled by Bank of England Governor Andrew Bailey. Aside from this, Wednesday’s release of the UK GDP preliminary report for the first quarter of 2021 will play a key role in influencing the British pound and will provide further directional momentum to the GBP / JPY cross.
From a technical perspective, the sustained breakout overnight through the strong horizontal resistance at 152.30-40 and a subsequent move past the previous year’s highs favors bullish traders. A bit of follow-up strength beyond 154.00 will reaffirm the constructive outlook and set the stage for an extension of the recent strong positive momentum seen over the last three weeks or so.
Technical levels
GBP/JPY
| Panorama | |
|---|---|
| Today’s Last Price | 153.55 |
| Today’s Daily Change | -0.09 |
| Today’s Daily Change% | -0.06 |
| Today’s Daily Opening | 153.64 |
| Trends | |
|---|---|
| SMA of 20 Daily | 151.05 |
| SMA of 50 Daily | 151.02 |
| SMA of 100 Daily | 147.14 |
| 200 SMA Daily | 142.51 |
| Levels | |
|---|---|
| Daily Previous Maximum | 154.03 |
| Daily Previous Minimum | 151.98 |
| Weekly Preview Maximum | 152.24 |
| Weekly Prior Minimum | 150.93 |
| Monthly Previous Maximum | 153.42 |
| Minimum Previous Monthly | 149.06 |
| Daily Fibonacci 38.2% | 153.25 |
| Daily Fibonacci 61.8% | 152.76 |
| Daily Pivot Point S1 | 152.4 |
| Daily Pivot Point S2 | 151.17 |
| Daily Pivot Point S3 | 150.36 |
| Daily Pivot Point R1 | 154.45 |
| Daily Pivot Point R2 | 155.26 |
| Daily Pivot Point R3 | 156.49 |
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