- GBPJPY continued to trade in the negative zone, and as a result, there as a sharp downside reaction.
- The pair managed to sustain the downside around a bullish trend line formed on the 4-hours chart
- In the UK, the Financial Stability Report, published twice a year by the Bank of England was released that impacted the market sentiment.
- In the Euro Zone, there were a few releases that impacted the risk sentiment and helped the GBPJPY to gain bids.
There was a downslide in the GBPJPY pair recently, as it traded lower towards 184.80 where it found a support trend line on the 4-hours chart that prevented the downside. The pair is currently correcting higher and may head higher.
However, it might face a major resistance area around the 200 simple moving average (4-hours), which is also near the 50% Fib retracement level of the last drop from the 186.97 high to 184.35 low.
On the downside, the highlighted trend line and support area must hold if buyers have to take the pair higher.
In the UK, there was hardly any major release, but in the Euro Zone there were some releases that impacted the market sentiment and helped the GBPJPY pair. One release that helped the US Dollar to gain traction was the Swiss Industrial Production is released by the Swiss Statistics.
The market was not expecting any major decline in the Swiss Industrial Production, but the result was disappointing. It registered a decline of 3.1% in Q3 2015, which was also on the higher side when compared with the last decrease of 2.5%.
Overall, there are chances of the GBPJPY pair moving towards the 200 MA (4H) if stays above the trend line and support area.