Yen pairs are on the move again today!
Can GBP/JPY go for another leg lower when the U.K. jobs figures are released?
Before moving on, ICYMI, yesterday’s watchlist looked at AUD/JPY’s consolidation breakdown after downbeat Chinese CPI. Be sure to check out if it’s still a good play!
And now for the headlines that rocked the markets in the last trading sessions:
Fresh Market Headlines & Economic Data:
U.K. BRC retail sales monitor rose from 3.7% y/y to 4.0% in June vs. projected 4.2% figure, reflecting slight pickup in consumer spending
Fed official Mester says there is no decision yet on July policy action but cited that they need to tighten somewhat in order to control inflation
Australia’s Westpac consumer sentiment index climbed from 0.2% to 2.7% in July to signal strong improvement in optimism
Australian NAB business confidence index rose from -3 to 0 in June to suggest that conditions are no longer worsening
U.K. claimant count rose by 25.7K in June vs. estimated 20.5K increase in joblessness and earlier 22.5K decline, jobless rate up from 3.8% to 4.0%
U.K. average earnings index accelerated from upgraded 6.7% figure to 6.9% in the three-month period ending in May, outpacing 6.8% consensus and suggesting stubborn wage inflation
Price Action News
Overlay of JPY Pairs 15-min
Despite the lack of catalysts on deck, the Japanese yen chalked up strong gains against its forex peers in today’s Asian session.
Market watchers were likely on edge for potential currency intervention, as Japanese officials have been jawboning and reiterating that they are watching FX moves closely.
The yen chalked up its largest gains against the commodity currencies, as risk-off flows may have picked up after some Fed officials spoke of the possibility of tightening again in July.
Upcoming Potential Catalysts on the Forex Economic Calendar:
German and eurozone ZEW economic sentiment at 9:00 am GMT
RBNZ monetary policy decision at 2:00 am GMT (July 12)
Use our new Currency Heat Map to quickly see a visual overview of the forex market’s price action! 🔥 🗺️
GBP/JPY: 15-min
GBP/JPY 15-min Forex Chart by TV
This pair has been on a steady decline, with its lower highs connected by a falling trend line that’s been holding since late last week.
Another test of the resistance zone, which lines up with the pivot point (182.00) and former short-term support, could be in the works.However, the U.K. economy just printed mixed jobs figures, with the higher than expected claimant count triggering another pickup in the jobless rate.
This could mean a consolidation breakdown for Guppy, possibly sending the pair below the near-term support at S1 (180.79) and onto a test of the next floor at S2 (179.88).
On the other hand, a move past the trend line resistance could set off a rally to the next upside barriers at R1 (182.92) and R2 (184.13) if risk-on flows return.
Just make sure you take note of the average GBP/JPY daily volatility of 150 pips when trading this pair!