Risk aversion continues to buoy the yen while a less-hawkish BOE Governor Mark Carney last Friday has put sterling under pressure.
This allowed for some pound weakness over the course of two sessions on Friday, following through to early Monday where GBPJPY reached a 1-month low of 167.73.
After the over 400-pip plunge since Friday’s high to today’s low, the pair has found support at the 38.2% Fibonacci retracement of the move from the November 2013 low (156.61) to the January 2014 high (174.74).
The pair bounced off this low towards a high of 169.76. This move higher could be a selling opportunity since risk appetite is low today.
Meanwhile, upside momentum appears weak since the RSI is very low and just above 30 although it has paused a recent decline. The stochastic is low at 22 but has moved out of extreme oversold territory.
Price action is below two moving averages (20SMA and 50SMA) indicating weakness in bullish sentiment.
Resistance is seen at the 23.6%Fibonacci level at 170.47. A break above this would open the way to the January 23rd high of 176.62.
A break below today’s low would target next support at 165.68, which is the 50% Fibonacci level.
Risk aversion continues to buoy the yen while a less-hawkish BOE Governor Mark Carney last Friday has put sterling under pressure.
This allowed for some pound weakness over the course of two sessions on Friday, following through to early Monday where GBPJPY reached a 1-month low of 167.73.
After the over 400-pip plunge since Friday’s high to today’s low, the pair has found support at the 38.2% Fibonacci retracement of the move from the November 2013 low (156.61) to the January 2014 high (174.74).
The pair bounced off this low towards a high of 169.76. This move higher could be a selling opportunity since risk appetite is low today.
Meanwhile, upside momentum appears weak since the RSI is very low and just above 30 although it has paused a recent decline. The stochastic is low at 22 but has moved out of extreme oversold territory.
Price action is below two moving averages (20SMA and 50SMA) indicating weakness in bullish sentiment.
Resistance is seen at the 23.6%Fibonacci level at 170.47. A break above this would open the way to the January 23rd high of 176.62.
A break below today’s low would target next support at 165.68, which is the 50% Fibonacci level.
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