- – The British Pound after a decline towards 143.35 found support against the Japanese Yen.
- – The GBP/JPY is currently attempting a break above a bearish trend line at 144.55 on the hourly chart.
- – Today in the UK, the CBI Distributive Trades Survey for May 2017 (MoM) released by the Confederation of British Industry posted a rise of 2%.
UK’s CBI Distributive Trades Survey
In the UK today, the CBI Distributive Trades Survey for May 2017 was released by the Confederation of British Industry. The market was positioned for the CBI Distributive Trades Index to rise by 10% in May 2017, compared with the previous month.
However, the result was below the forecast, as the increase was only 2%. Moreover, the Net Borrowing released by the National Statistics for April 2017 posted £9.648B, which was more the forecast of £8.150B. On the other hand, the last reading was revised down from £4.365B to £2.335B. The report mentioned that “Public sector net borrowing (excluding public sector banks) decreased by £23.4 billion to £48.7 billion in the financial year ending March 2017 (April 2016 to March 2017), compared with the financial year ending March 2016; this is the lowest net borrowing since the financial year ending March 2008”.
Overall, the GBP/JPY pair may struggle in the near term, but the 143.80 support may play an important role.
GBP/JPY Technical Analysis
The British Pound was under pressure earlier, as it moved from 147.00 to 144.00 the Japanese Yen. Later, the GBP/JPY pair found support near 143.35 and started a recovery. It traded towards 145.40 where it faced offers and declined once again towards 143.76.
The pair is now forming support at 143.80 and moving higher. It is already above the 23.6% Fib retracement level of the last decline from the 145.38 high to 143.76 low. However, it is facing resistance near a bearish trend line at 144.55 on the hourly chart.
The same trend line also coincides with the 100 hourly simple moving average at 144.56. Moreover, the 50% Fib retracement level of the last decline from the 145.38 high to 143.76 low is at 144.57. So, a break above 144.60-70 is needed for the pair to overcome selling pressure and resume uptrend. Looking at the last two candles, there are chances of gains towards 145.40 in the near term if 143.80 remains intact.Tags: British Pound, GBP/JPY Technical Analysis, Japanese Yen