Key Points
- The British Pound declined against the Japanese yen recently and broke a couple of important support levels.
- There were a couple of support trend lines on the hourly chart of the GBPJPY, which were broken to ignite a downside move.
- Today, the UK Industrial Production report was released by the National Statistics.
- The forecast was lined up for a decline of 0.2% in July 2016, but it posted a rise of 0.1%.
GBPJPY Technical Analysis
The British Pound tumbled recently against the Japanese yen and closed below the 21 hourly simple moving average. Moreover, the GBPJPY pair also closed below a couple of support trend lines on the hourly chart.
The pair is currently trading near the 135.70 support, which may be broken soon for more declines in the near term.
If the pair corrects higher, then the 38.2% Fib retracement level of the last drop from the 138.18 high to 135.68 low can be seen as a resistance area.
UK Industrial Production
Today during the London session, the UK Industrial Production, which measures outputs of the UK factories and mines and it is a major indicator of strength in the manufacturing sector was released by the National Statistics.
The forecast was lined up for a decline of 0.2% in July 2016, compared with the previous month. However, the outcome was on the higher side, as there was a rise of 0.1%. The report added that “In July 2016, total production output was estimated to have increased by 2.1% compared with July 2015. All main sectors saw production increase with mining & quarrying providing the largest contribution to growth, increasing by 7.2%”.
Overall, the reports were positive for the GBPUSD pair, but the market sentiment is in favor of the yen buyers at the moment.
