GBPJPY Back in the Red 

The GBPJPY currency pair appears poised for its ninth consecutive day of decline in the last twelve, influenced by recent data from the UK that exerted pressure on the pound. The labour data revealed a shift in employment of 50,000, marking a slowdown from the previous 54,000, while the unemployment rate held steady at 4.2%.  

Additionally, wage growth contracted, with average earnings, including bonuses, registering a 7.2% increase—lower than the preceding 8% and the anticipated 7.7%. Meanwhile, in Japan, the year-over-year PPI dipped from 0.9% to 0.3%, surpassing the 0.1% forecast but contributing further to the strain on the currency pair. 


On the 4H chart, an ascending channel has been broken down, as the pair failed to clear the psychological resistance at 187.968. The retracement passed the 61.8% Fibonacci golden ratio at 182.121 before finding support. As we advance, the pair could initiate a pullback from the recent selloff but faces challenging hurdles in the upcoming sessions. 

The 100-SMA (orange line) and 50-SMA (blue line) at 183.728 and 184.235, respectively, could be the first challenge the buyers will face. Higher resistance at 184.637 and 185.425 could come into play if the pair shifts above the multiple-SMAs, with the 25-SMA at 185.834 potentially offering a last line of defence to the retest of the channel breakdown point at 186.579. 

However, failure to exceed the multiple SMAs could add to the recent downside pressure. A retest of 182.121 could then become likely, while lower support is established at 180.962. Should the selling pressure continue, a demand zone at 179.812 could hold buyers in the longer term to prevent further downside.  


On track for another day of decline, the GBPJPY currency pair faces challenging resistance from multiple SMAs on the 4H chart. These levels may need clearance if the retracement from the recent channel breakdown could continue into the week’s latter sessions. 

Sources: Koyfin, Tradingview 

Piece written by Tiaan van Aswegen, Trive Financial Market Analyst 

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