Key Points
- The British Pound rocketed higher against the Japanese yen recently, and looks set for more gains.
- There was a monster breakout pattern formed on the 4-hours chart of the GBPJPY pair, which was broken during the recent upside move.
- In the UK, the PMI Construction was released by the Chartered Institute of Purchasing & Supply and Markit Economics.
- The outcome was positive, as there was a rise from the last reading of 45.9 to 49.2 in August 2016.
GBPJPY Technical Analysis
The British Pound traded higher recently versus the Japanese yen and tested the 138.00 level. Before the upside move, the GBPJPY pair broke a monster breakout pattern formed on the 4-hours chart in the form of a contracting triangle.
The pair may dip a few pips from the current levels, but may find support near the 23.8% Fib retracement level of the last leg from the 133.34 low to 138.01 high.
On the upside, a break of the 138.00 level may push the pair towards 140.00.
UK PMI Construction
Today during the London session, the PMI Construction, which shows business conditions in the UK construction sector was released by the Chartered Institute of Purchasing & Supply and Markit Economics.
The forecast was lined up for a rise from the last reading of 45.9 to 46.1 in August 2016. However, the outcome was on the higher side, as there was a rise to 49.2. The report added that “UK construction companies indicated a sustained reduction in business activity during August, but the pace of decline was only marginal and much softer than the seven-year record seen during July. New order volumes also moved closer to stabilization, with the latest reduction the least marked since May. This contributed to a renewed rise in staffing levels across the construction sector and a rebound in business expectations for the next 12 months“.
Overall, the British Pound may continue to rise versus the Japanese yen and may retest the 138.00 level again.
