GBP/JPY reclaims 183.00 as it faces resistance following solid UK data – Crypto News – Crypto News
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GBP/USD climbs sharply towards 1.2080 on US mixed data GBP/USD climbs sharply towards 1.2080 on US mixed data

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GBP/JPY reclaims 183.00 as it faces resistance following solid UK data – Crypto News

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  • GBP/JPY climbs strongly, challenging resistance at 183.35, driven by positive UK credit and mortgage data.
  • UK’s robust services sector performance and higher Gilt yields support GBP, with PMI hitting a seven-month high.
  • Contrasting with UK’s upbeat data, Japan’s Manufacturing PMI remains in recession, influencing BoJ’s policy outlook.

The GBP/JPY extends its gains for the second straight day and faces solid resistance at the bottom of the Ichimoku Cloud (Kumo) at around 183.35. Nevertheless, it posts solid gains of more than 1% after jumping from a daily low of 181.00, sponsored by a risk-on impulse and upbeat data from the United Kingdom (UK).

GBP/JPY soared from 181.00 bolstered by UK credit data, and improvement in business activity

The Bank of England (BoE) revealed that the British rely on credit, as borrowing increased to its highest level in seven years in November. That, along with a rise in mortgage approvals, suggests that households remain less worried about higher interest rates set by the BoE.

In the meantime, S&P Global revealed that business activity in the services sector improved from 50.9 in November to 53.4 in December, hitting a seven-month high, exceeding forecasts of 52.7. The S&P Global Composite PMI, which encompasses manufacturing and services, rose from 50.7 in November to 52.1 in December.

Consequently, Pound Sterling (GBP) currency pairs, like the GBP/USD and GBP/JPY, remain underpinned, as UK 10-year Gilts yield 3.74%, twelve basis points higher than Wednesday’s close.

On the Japanese front, the Jibun Bank Manufacturing PMI for December disappointed investors as the reading remained in recessionary territory at 47.9, down from November’s 48.3, suggesting the weaker reading could prevent the Bank of Japan (BoJ) from normalizing monetary policy.

GBP/JPY Price Analysis: Technical outlook

The cross-pair remains neutrally biased, sitting below the Kumo, though the distance between the Tenkan and Kijun-Sen is reducing, suggesting that a bullish cross might occur in the near term. It should be said the Chikou Span is above the Kumo but remains below the price action, a bearish signal. Therefore, mixed signals warrant caution.

IF buyers lift the pair above the Kumo, that will mean the pair needs to rally more than 300 pips to shift bullish and reclaim 186.00. On the other hand, failing to climb inside the Kumo could pave the way for a pullback, with sellers targeting the Kijun-Sen at 183.10, followed by the Tenkan-Sen level at 181.25.

 

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