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Market Analysis

Home » Featured » GBPJPY Might Break Down

GBPJPY Might Break Down

Posted by FXTimes in Featured - December 1st, 2015 3:22 pm GMT

British Pound GBPUSD GBPCHF

Key Points

  • British Pound surged higher against the Japanese Yen, and traded close to the 186.00 resistance area.
  • There is an interesting looking triangle pattern formed on the hourly chart, which is on the verge of a break moving ahead.
  • Today, the UK Manufacturing Purchasing Managers Index (PMI) was released by both the Chartered Institute of Purchasing & Supply and the Markit Economics.
  • The forecast was slated for 54.0, but the PMI declined to 52.7 in November 2015. <br><br>

Technical Analysis

The GBPJPY pair enjoyed a decent upside run recently, but it looks like the pair created a short-term top near 186.00. There is a triangle pattern formed on the hourly chart, which acted as a hurdle for more upsides and pushing the pair lower.

GBPJPY

A break below the triangle support area may call for a move towards the 100 hourly simple moving average. The GBPJPY pair is already below the 200 MA, which is a bearish sign.

On the upside, a break above 186.00 may negate the bearish view for the pair.

UK Manufacturing PMI

Today, the UK Manufacturing Purchasing Managers Index (PMI), which captures business conditions in the manufacturing sector was released by both the Chartered Institute of Purchasing & Supply and the Markit Economics. The forecast was slated for a reading of 54.4 in November 2015. However, the outcome was disappointing, as the PMI declined to 52.7.

The report stated that the “seasonally adjusted Markit/CIPS Purchasing Manager’s Index® (PMI®) posted 52.7 in November, down from October’s 16-month high of 55.2 (originally reported as 55.5). The headline PMI has remained above the neutral 50.0 mark in each month since March 2013“.

Overall, the GBPJPY pair came under pressure after the release, and may break down moving ahead.

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