GBP/JPY Into Support Ahead of UK Retail Sales, Japanese CPI
- GBPJPY at support ahead of UK Retail Sales, Japanese CPI
- Release to threaten immediate short-bias
- Updated targets & invalidation levels
Chart Created Using FXCM Marketscope 2.0
Technical Outlook: GBPJPY is checking a near-term support confluence at 1.5830/48 ahead of Thursday's UK Retail Sales release. This region is defined by the 61.8% extension off the lows, the 61.8% retracement of the advance and a sliding parallel of the operative median-line formation extending off the 3/7 low. We’re likely to see some recovery off this mark but the broader outlook remains weighted to the downside while below the sliding parallel extending off the 3/10 high / 161.25. A break below this support region targets the lower median-line parallel (~157.60) backed by the 156.72/93Fibonacci confluence.
Keep in mind markets are already expecting a weaker print on UK retail sales with consensus estimates calling for a drawdown for the month of February, leaving the risk to the topside for the sterling on a stronger-than-expected print. Interim resistance targets stands at 159.40 backed by the median-line / 160.12, 160.75 & our bearish invalidation level at the weekly opening-range high. Continue tracking this setup and more throughout the week- Subscribe to SB Trade Desk and take advantage of the DailyFX New Subscriber Discount!
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- The DailyFX Speculative Sentiment Index (SSI) has held a net-long position since mid-December with the ratio standing at 1.42 (59% of traders are long- up from 54% the previous day)
- After hitting an extreme above +3.0 at the start of the year, the ratio has narrowed substantially since January suggesting that the retail long-bias may be waning (bullish)
- Open interest is 0.8% higher than yesterday and 4.0% above its monthly average heading into the UK & Japanese data prints tomorrow
Why and how do we use the SSI in trading? View our video and download the free indicator here
Relevant Data Releases This Week
Other Setups in Play:
- GBP/USD Eyes March High on Sticky UK CPI- Bullish Invalidation 1.4174
- Webinar: USD Crosses in Focus Post FOMC- Reprieve to be Short-Lived
- USD/CAD Sentiment Hits Extremes Ahead of CPI- 1.2965 Critical Support
- AUD/USD Post-FOMC Rally at Risk Ahead of Australian Labor Report
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---Written by Michael Boutros, Currency Strategist with DailyFX
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.