GBP/JPY threatens the 20-day SMA as the yen gains ground – Crypto News – Crypto News
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GBP/JPY advances firmly above 162.00 as bets over BOE-BOJ policy divergence accelerates GBP/JPY advances firmly above 162.00 as bets over BOE-BOJ policy divergence accelerates

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GBP/JPY threatens the 20-day SMA as the yen gains ground – Crypto News

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  • The GBP/JPY cross tallies a second consecutive day of losses, falling below the 182.50 area on Friday.
  • The 20-day SMA at 181.44 is poised for a retest.
  • The Yen gained ground against most of its rivals on rising Japanese Yields after Labor Cash Earnings data.

On Friday, the GBP/JPY cross lost ground as the JPY trades against most of its rivals, including the USD, EUR,GBP and AUD. In that sense, the USD/JPY fell to a two-week low following US Nonfarm Payrolls data pressured down by falling American yields while the Japanese rates are rising.

In that sense, the yield on the 2,5 and 10-year Japanese bonds rose to their highest level since May. On the other hand Nonfarm Payrolls from the US from June came in lower than expected at 209K vs the 225k expected, US yields retreated. A 1.70% decrease was seen in the 2-year yield, bringing it down to 4.90%, whereas the rates for the 5-year and 10-year yields dropped to 4.29% and 4.02%, respectively.

In that sense, strong Labor Cash Earnings data from Japan released early in the Asian session seem to have fueled the rise in Japanese yields. In that sense, the average income, before taxes, per regular employee in the Asian country rose by 2.5% YoY in May versus the 0.7% expected by the markets. It is worth noting that the Bank of Japan (BoJ) expressed that its short-term objective was to see wage growth and rising economic activity. That being said, the expectations of a pivot in monetary policy by the BoJmay continue to strengthen the JPY.

On the British side, their financial calendar had nothing relevant to offer. The focus is next Tuesday’s labor market data, including Claimant Count and Average Earnings figures.

GBP/JPY Levels to watch

The daily chart suggests a bearish outlook for the short term. Indicators are starting to show weakness with the Relative Strength Index (RSI) pointing south and the Moving Average Convergence Divergence, printing higher red bars. On the bigger picture, the Outlook will favor the GBP as long as the cross holds above its main Simple Moving Averages of 20,100, and 200 days.

Support Levels: 181.45 (20-day SMA), 181.00 and 180.50.
Resistance Levels: 182.70, 183.00, 184.00.

GBP/JPY Daily chart

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