GBPJPY – Risk of More Losses Remain22 December, 2015 by Aayush Jindal in Fundamental Analysis, Market Analysis, Technical Analysis
GBPJPY – Risk of More Losses Remain
- British Pound continued to struggle not only against the US Dollar but also against the Japanese Yen.
- There is a major bearish trend line formed on the 4-hours chart of GBPJPY, which is acting as a barrier for buyers.
- In the UK, the GfK Group Consumer Confidence posted a minor increase from the last reading of 1 to 2 in December 2015.
- Today, the UK Net Borrowing report will be released by the National Statistics with a forecast of £11.00B in October 2015.
GBPJPY Technical Analysis
The GBPJPY pair is under a lot of bearish pressure, and it is following a monster bearish trend line formed on the 4-hours chart. The pair attempted on many occasions to break the highlighted trend line and resistance area, but failed to settle above it.
Currently, the pair is finding bids near the 180.0 area. So, there is a chance of a minor recovery from the current levels. On the upside, the an initial resistance can be around the 38.2% Fib retracement level of the last drop from the 183.90 high to 179.94 low.
On the downside, a break below the last low of 179.94 may call for more losses may be towards the 179.50 level.
UK Net Borrowing
Today, the UK Net Borrowing, which captures an amount of new debt held by the U.K. governments (the financial deficit in the UK national accounts) will be released by the National Statistics. The forecast is lined up for an increase from the last reading to £11.00B in October 2015. Let us see how the outcome shapes up and whether it can be helpful for the GBPJPY pair or not.
GfK Group Consumer Confidence
Earlier today, the UK GfK Group Consumer Confidence, which is a leading index that measures the level of consumer confidence in economic activity was reported. The forecast was lined up for no increase from the last reading of 1 in December 2015. However, the outcome was above the forecast, as the UK GfK Group Consumer Confidence rose from 1 to 2.
However, there was no major impact on the British Pound. A minor upside reaction was noted, which can be seen as a profit taking move. The GBPJPY pair remains under a lot of bearish pressure, and as long as it is below the highlighted trend line and resistance area more losses are possible.