Key Highlights
- The British Pound after declining towards 139.50 against the Japanese Yen found support.
- The GBPJPY pair broke a major bearish trend line at 140.20 on the 4-hours chart to initiate a recovery.
- Japan’s Unemployment Rate remained at 2.8% in July 2017.
- The Jobs to application ratio in July 2017 increased from the last reading of 1.51 to 1.52.
GBP/JPY Technical Analysis
The British Pound declined heavily during the past few weeks and traded as low as 139.32 against the Japanese Yen. The GBP/JPY pair is currently recovering and might trade towards 141.70-142.00.
After trading as low as 139.32, the pair started correcting higher. During the upside move, it broke a major bearish trend line at 140.20 on the 4-hours chart. The pair also climbed above the 38.2% Fib retracement level of the last decline from the 143.18 high to 139.32 low.
An ascending channel with support at 140.20 is forming, which could take the pair higher. On the upside, an initial hurdle is near the 50% Fib retracement level of the last decline from the 143.18 high to 139.32 low.
Above 141.25, the channel resistance at 141.70 is positioned with the 100 simple moving average (H4). Therefore, it the pair extend gains, it is likely to face strong offers near 141.70 or 142.00. On the downside, the channel support at 140.20 is a key buy zone.
Japan’s Unemployment Rate
Japan today saw the release of the Unemployment data for July 2017. The Unemployment Rate for July 2017 from the Ministry of Health, Labour and welfare (published by the Japan Statistics Bureau) posted no change from the last 2.8%.
On the other hand, the Jobs to application ratio in July 2017 rose from the last reading of 1.51 to 1.52. Looking at the number of employed persons in July 2017, there was a rise of 590 thousand (+0.9%) in the count to 65.63 million compared with the same month a year ago.
Furthermore, the number of unemployed persons in July 2017 were down by 120 thousand (5.9%) to 1.91 million compared with the same month a year ago.
Overall, there are chances of GBP/JPY moving higher towards 141.70 as long as the 140.20 support is intact.
