Daily Analysis For GBP/JPY 25-05-2023

Daily Analysis For GBP/JPY 25-05-2023

GBP/JPY Analysis
Key Points for GBP/JPY pair
• The GBP/JPY currency pair exhibits an upward inclination following a period of testing the 20-day Exponential Moving Average (EMA) throughout the week. However, it encounters difficulties in the vicinity of the 168.00 level.
• Oscillators present a combination of indications, although the Relative Strength Index (RSI) hints at a potential retracement in the near future.
• The bullish momentum of GBP/JPY faces resistance from a counter-trendline. If this barrier is breached, it could potentially expose the pair to a level of 175.00.
Today's Scenario: - The GBP/JPY currency pair relinquishes its previous two days of progress and experiences a slight retreat towards the 167.00 level as the Asian session commences. Currently, the GBP/JPY is trading around 167.16, marking a decline of 0.16%.
Diagram of GBP/JPY
GBP/JPY
Economic Events : -
GMTEventImpactCurrency
00:01(United Kingdom) Car Production YoYLowGBP
00:50(Japan) Foreign Bond InvestmentLowJPY
00:50(Japan) Stock Investment by ForeignersLowJPY
01:00(Australia) RBA Payments System Board MeetingLowAUD
04:35(Japan) 40-Year JGB AuctionLowJPY
07:00(Germany) GDP Growth Rate QoQMediumEUR
07:00(Germany) GDP Growth Rate YoYMediumEUR
07:00(Germany) GfK Consumer ConfidenceHighEUR
07:45(France) Business ConfidenceMediumEUR
07:45(France) Business Climate IndicatorLowEUR
08:00(Spain) PPI YoYLowEUR
09:30(Slovenia) Tourist Arrivals YoYLowEUR
09:30(Slovenia) Business ConfidenceLowEUR
10:00(Euro Area) ECB Annual Report 2022LowEUR
10:00(Euro Area) ECB Guindos SpeechHighEUR
10:10(Italy) BTP Short TermLowEUR
11:00(United Kingdom) CBI Distributive TradesMediumGBP
11:00(Latvia) Unemployment RateLowEUR
12:00(Canada) CFIB Business BarometerLowCAD
13:30(Canada) Manufacturing Sales MoMLowCAD
13:30(United States) Jobless Claims 4-week AverageHighUSD
13:30(United States) Continuing Jobless ClaimsHighUSD
13:30(United States) Initial Jobless ClaimsHighUSD
13:30(United States) Chicago Fed National Activity IndexMediumUSD
13:30(United States) Real Consumer Spending QoQLowUSD
13:30(United States) GDP Sales QoQLowUSD
13:30(United States) Core PCE Prices QoQLowUSD
13:30(United States) PCE Prices QoQLowUSD
13:30(United States) GDP Price Index QoQMediumUSD
13:30(United States) Corporate Profits QoQMediumUSD
13:30(United States) GDP Growth Rate QoQMediumUSD
13:30(Canada) Average Weekly Earnings YoYLowCAD
15:00(United States) Pending Home Sales YoYMediumUSD
15:00(United States) Pending Home Sales MoMMediumUSD
15:30(United States) EIA Natural Gas Stocks ChangeLowUSD
15:30(United States) Fed Collins SpeechMediumUSD
16:00(United States) Kansas Fed Composite IndexLowUSD
16:00(United States) Kansas Fed Manufacturing IndexLowUSD
16:30(United States) 8-Week Bill AuctionLowUSD
16:30(United States) 4-Week Bill AuctionLowUSD
17:30(United Kingdom) BoE Haskel SpeechLowGBP
18:00(United States) 7-Year Note AuctionLowUSD
23:00(New Zealand) ANZ Roy Morgan Consumer ConfidenceLowNZD
Buy Scenario: - The daily chart indicates that the GBP/JPY currency pair maintains an upward bias, despite encountering significant resistance around the 168.00 level. Although it has recorded consecutive days of gains, the inability to surpass the 168.00 mark raises the possibility of downside risks. Moreover, the Relative Strength Index (RSI) indicator continues to decline, indicating the presence of sellers in the market.
On the other hand, the Rate of Change (RoC) suggests that buyers are still active, leaving room for a potential rally. If GBP/JPY buyers manage to reclaim the 168.00 level, it could potentially trigger a further upward movement towards the swing high of 169.27 recorded on December 13. However, there are a few obstacles to overcome on the upward path.
Firstly, the year-to-date (YTD) high is situated at 167.97, in close proximity to the 168.00 level. A breach of the latter would expose the previous cycle high from December at 169.27. Till we do not advise to buy GBP/JPY.
Sell Scenario: - Conversely, if the GBP/JPY falls below 167.00, it could intensify the downward pressure, initially targeting the 20-day Exponential Moving Average (EMA) at 165.85, followed by the recent weekly low of 165.42, before potentially testing the 50-day EMA at 164.21. Till we do not advise to sell GBP/JPY.
Support and Resistance Level: -
SupportResistance
S1 171.32-R1 172.66
S2 170.64-R2 173.32
S3 169.98-R3 174.00

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