The British pound weaken against the Japanese yen to retrace the advance from the end of July, and the GBP/JPY may continue to hold a broad range throughout the month as investors weigh the outlook for a global recovery.
[B]Currency Pair: [/B]GBP/JPY
[B]Chart: [/B]60 Min Charts
[B]Short-Term Bias[/B][B]:[/B] Flat
[B][U]Analysis[/U][/B]
The British pound weaken against the Japanese yen to retrace the advance from the end of July, and the GBP/JPY may continue to hold a broad range throughout the month as investors weigh the outlook for a global recovery. After reaching a high of 197.48 in September, the pound-yen slipped to a low of 118.83 in January as investors curbed their appetite for risk however, the rebound in market sentiment has led the pair higher throughout the first-half of the year, and the improvement in the economic outlook may lead the pair to retrace the sell-off from the fourth-quarter of 2008 as investors expect a global recovery towards the end of the year. Over the next few hours of trading, we may see the GBP/JPY continue to push lower following the slump in global equities, and may retrace the advance from July to work its way towards 148.80-90 (38.2% Fib). However, as the RSI approaches oversold territory, moves to the downside are likely to be capped, and we may see the pair retrace the overnight decline to fill-in the gap from the 120-SMA at 158.33. Be sure to check out other Technical Reports from DailyFX for additional information on the major currency pairs.
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