- – The British Pound gained bids recently and moved above 139.00 versus the Japanese yen.
- – The upside was prevented by a monster bearish trend line with resistance at 140.00-140.10 on the 4-hours chart.
- – In the UK today, the Manufacturing Purchasing Managers Index (PMI) for March 2017 released by both the Chartered Institute of Purchasing & Supply and the Markit Economics posted a decline from 54.6 to 54.2.
UK Manufacturing PMI
Today in the UK, the Manufacturing Purchasing Managers Index (PMI) for March 2017 was released by both the Chartered Institute of Purchasing & Supply and the Markit Economics. The market was positioned for a rise from the last reading of 54.6 to 55.1.
However, the outcome was on the lower side, as the UK Manufacturing PMI posted a decline from 54.6 to 54.2. It’s still a good reading, but we cannot ignore the fact that it slipped to a four-month low of 54.2 in March 2017. Commenting on the report, the Senior Economist at IHS Markit, Rob Dobson, stated “The survey data suggest that the goods-producing sector made a solid contribution to GDP during the opening quarter of 2017. However, it’s clear that the expansion will be less than the buoyant 1.3% rise
seen in the fourth quarter of last year”.
Overall, the result was mixed, and may not help GBP/JPY in gaining pace, which is why the pair might continue to face resistance near 140.00.
GBP/JPY Technical Analysis
The British Pound had a good run against the Japanese yen, as it moved above the 138.80 and 139.00 resistance levels. The GBP/JPY pair traded towards 140.00 where it found a monster bearish trend line on the 4-hours chart.
The 140.00 level acted as a strong barrier, and the same trend line stopped upside on many occasions. So, it won’t be easy for the pair to break and move towards 141.00. There is a chance of a dip in the near term. An initial support is around the 38.2% Fib retracement level of the last wave from the 137.51 low to 140.08 high at 139.10.
Above 139.10 lies the 100 simple moving average at 139.30. I think we may see some ranging moves in GBP/JPY with resistance at 140.00, and support at 139.00 until there is a real break.Tags: British Pound, GBP/JPY Technical Analysis, Japanese Yen, UK Manufacturing PMI