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Market Analysis

Home » Featured » GBPJPY Recovers Sharply and Closes Gap

GBPJPY Recovers Sharply and Closes Gap

Posted by FXTimes in Featured - November 16th, 2015 12:53 pm GMT

pound-sterling-us-dollar

Key Points

  • Yen opened the week with a gap higher against the British Pound due to the safe haven status and tensions in France.
  • However, the GBPJPY pair managed to recover sharply during the London session, and closed the open gap.
  • UK Rightmove House Price Index registered a decline of 1.3% in November 2015, compared with the preceding month.
  • In terms of the yearly change, there was an increase of 6.2%, which was more than the last rise of 5.6%

Technical Analysis

The GBPJPY pair after trading towards 186.00 recovered sharply and managed to close the opening week gap. The upside was so strong that the buyers cleared a bearish trend line and the 100 hourly simple moving average.

GBPJPY

The pair is currently trading near the 76.4% Fib retracement level of the last move from the 187.51 high to 186.00 low. There is a possibility of a minor correction from the current levels that may find support near the broken trend line.

On the upside, a break above the 76.4% Fib level could take the pair towards the last swing high of 187.50.

UK Rightmove House Price Index

In the UK today, the Rightmove House Price Index that provides a sample of residential property prices in the UK was published. The outcome was mixed as the monthly change in the index fell by 1.3% in November 2015. However, the yearly change was better, as there was an increase of 6.2%, which was more than the last rise of 5.6%.

The report stated that “Smallest drop since 2011 in new seller asking prices (-1.3%) during seasonal November slowdown, indicative of even higher prices next year”.

Overall, there is a chance of a minor correction from the current levels, which can be seen as a buying opportunity.

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