GBP/JPY and USD/JPY Price Outlook
- Eyes on Bank of England rate decision today, and NFP report for USD tomorrow.
- US Dollar and British Pound price action against Japanese Yen.
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GBP/JPY – USD/JPY- Rough time for GBP
Since the start of the week, Sterling Pound has been losing value against major currencies. On Tuesday GBP/JPY dropped to 131.61- its lowest levels in 32 months. Meanwhile, US dollar firmed against Japanese Yen and today, USD/JPY has tested 109.32 – its highest levels in eight weeks.
The Relative Strength Index (RSI) on Monday, dipped below 30 and remained in oversold territory for GBP/JPY emphasizing the seller’s domination. In turn, USD/JPY remained above 50 and climbed today to 60, indicating to the strength of the upward momentum.
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GBP/JPY DAILY PRICE CHART (JAN 8, 2017 – AUG 1, 2019) Zoomed out
GBP/JPY DAILY PRICE CHART (April 15 – AUG 1, 2019) Zoomed IN
Looking at the daily chart, we notice since the start of this week GBP/JPY has been moving in the trading zone 130.84 – 133.40 eyeing a test of the low end. Hence, a close below the low end of this zone may send the price towards 128.80. Although, the weekly support levels and the zone marked on the chart (zoomed in) should be watched along the way.
On the other hand, if GBP/JPY closes above the high end of the current trading zone, this suggests more bullishness towards 135.55. However, the weekly and daily resistance underlined on the chart (zoomed in) should be kept in focus.
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USD/JPY DAILY PRICE CHART (MAy 22, 2018 – AUG 1, 2019) Zoomed out
USD/JPY DAILY PRICE CHART (March 21 – AUG 1, 2019) Zoomed in
Looking at the daily chart, we notice on July 25 USD/JPY closed in the higher trading zone 108.61 -109.77. Since then, the pair tested every day the low end of this zone however, it has been closing above it, marking a clear intention from the buyers to lead the price to the high end of the zone.
Yesterday, USD/JPY rebounded from the weekly resistance 109.00 however, today the pair broke above this level suggesting the price may rally towards 111.52. Although, the weekly resistance levels underscored on the chart (zoomed in) need to be kept in focus.
On the flipside, any close below the low end of current trading zone may press the price towards the vicinity of July 18 low at 107.30. Nonetheless, the weekly support levels underlined on the chart (zoomed in) should be considered.
Written By: Mahmoud Alkudsi
Please feel free to contact me on Twitter: @Malkudsi