Short-Term Forex Technical Outlook: GBP/JPY

The economic slump in the global economy has certainly taken a toll on the Japanese economy, and as the downturn in the world’s second largest economy intensifies, the yen is likely to face increased selling pressures over the near-term as the low-yielding currency’s safe-haven status comes under pressure.

[B]Currency Pair: [/B]GBP/JPY
[B]Chart: [/B]60 Min Charts
[B]Short-Term Bias:[/B] Flat

[B][U]Analysis

[/U][/B]

The economic slump in the global economy has certainly taken a toll on the Japanese economy, and as the downturn in the world’s second largest economy intensifies, the yen is likely to face increased selling pressures over the near-term as the low-yielding currency’s safe-haven status comes under pressure. After reaching a high of 165.11 on 10/30, the GBPJPY slipped to a low of 118.83 in the previous month month, and we may see the pair attempt to retrace the sell-off from October over the following month as the fundamental outlook weighs on the appeal of the Japanese yen. Over the remainder of the week, I expect the pound-yen make another attempt to push above 141.90-142.00 (50.0% Fib) however, if the pair continues to find resistance at this level, I would expect the GBPJPY to trade within a broad range over the near-term as risk trends continue to drive price action in the currency market. Be sure to check out other Technical Reports from DailyFX for additional information on the major currency pairs.

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