GBPJPY

The GBPJPY has been under pressure as  risk trades are being liquidated.  On the chart the 100 day moving average was held.  Today, the trendline was broken at the 202.93.   Intraday traders will be watching the level to see if the trend lower can continue. 

The GBPJPY at 206.95 is a bit away, but watch the 206.33 level.  The 100 and 200 hour moving average are both located here.  The low for the day has been 206.62 so far.    

The GBPJPY broke through the 200 hour moving average (205.83) but could not get through the 100 hour moving average at 206.21.  The pair is back down to the 200 hour moving average as the market regroups.

On a more intermediate term perspective, it seems the up and down action is suggesting a consolidation phase.  As a result, I would not be surprised if the daily momentum extends the range to the upside.

The market will be watching these levels today.

The cross trading is dominating this morning.  GBPJPY is moving higher on the back of a stronger stock market. DJIA up 106, S and P up 10, Nasdaq up 34.  The GBPJPY completed a 50% retracement of the move lower on the 21st of April, and over the last few days have moved higher to sideways. 

EURGBP is also moving lower this morning which is keeping GBP bid and EUR offered.  That pair had a few days of up/down volatility and is now moving above and below the major moving averages.

The market took two stabs at the support from the 50% retracement and the 100 bar moving average at 203.51 (see previous post from earlier outlining these support levels).  The low print was 203.40 bid, but it quickly bounced back above the level on profit takers.  This was a good level for the market to stop.  Much depends on the equity markets going forward, so the level may eventually give way. However, so far, so good.

Support at 203.54. 50% retracement and the 100 hour moving average.

The GBPJPY is testing the 207.10 support area now.  This level should provide support.

The GBPJPY had an impressive trend move today - moving during London and NY time frame from 203.60 to the high of 208.99.  The stock earnings over the last few days which propelled stocks higher, some feelings about a UK mortgage rescue plan in the housing market, and feeling that UK easings might be done for the time being, have supported the pair.

The GBPJPY found resistance at the 207.75-80 level (squeezing to 207.90 high) before moving back lower all the way to the support level of 207.12 (207.10 was the low) in the next 20 minutes.  So I have the range pegged (see the post at 8:08 when the bottom at 207.12 was mentioned as a support level) for the time being.

The market has moved back toward the midpoint of the 207.80-207.12 range now as it prepares for the stock market.  A stock market that corrects will extend the downside.  One that surges higher (more than 150 points) will see the upper band broken.