GBP/JPY is expected to trade in a lower range. It is undermined by the diminished investor risk appetite, soft undertone EUR/USD, and Japan export sales. But GBP/JPY losses are tempered by the demand from Japan importers and position adjustment ahead of weekend. The sterling got hurt after Bank of England’s chief economist Andrew Haldane said that the BOE “stands ready” to cut interest rates if needed to tackle low inflation.
The daily chart is mixed as stochastic is rising from oversold levels, but the MACD is still in bearish mode.
The pair is trading above its pivot point. It is likely to trade in a higher range as far as it remains above its pivot point. As long as the price is keeping above its pivot point, a long position is recommended with the first target at 180.80 and the second target at 181.80. In an alternative scenario, if the price moves below its pivot points, short positions are recommended with the first target at 177.10. A break of this target would push the pair further downwards, and one may expect the second target at 176.15. The pivot point is at 178.55.
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