Nikkei opens up slightly higher. GBPJPY moves up, but comes off as the market consolidates

The Nikkei opened at its highest level in 15 months and this led to a slight move higher in some of the risk pairs like the GBPJPY.  The stocks have since come off and this keeps the pair contained for now.

The GBPJPY has been waffling around the 200 bar MA on the 5 minute chart at the 1.4902 level (green line in the chart above).  The market has drifted higher on the higher open but is now just below at the 149.00 area.. 

The pair in NY corrected 50% of the Wednesday low to Thursday high in the NY session and moved back above the 100 bar MA on the 5 minute chart (blue line in the chart above)  in late NY trading.  The move above the 200 bar MA (green line in chart above) is the next step for the pair.  

With the low for the day at 148.87 the downside risk is limited.  A move below this level would not be welcomed and would likely lead to a move toward the 148.72 level where the 100 bar MA on the 5 minute chart is found.  However, if the low can hold, and the stock market can hold its own,  a move higher may be in the cards.

Longer term, the pair has an upside target at the 150.42 where the 200 day moving average is found.  From there the market will need to make the call dependent on market demand.   

UK RICS House Price Balance (GBP/JPY)

The UK’s House Price Index came in stronger than expected for October at 34% vs. the estimate of 28% and the prior reading of 22% (revised lower 21%,) hitting a 3-year high. The BRC Retail Sales Monitor was also better than the prior month at +3.8% vs. 2.8% the prior month.

On the GBP/JPY chart below which is capturing yesterday’s move, we see the pair has hit the 50% retracement on this positive report and trying to push through ahead of the Nikkei open and Asian trading.

Gbp/Jpy trades above 100 hour M/A

Gbp/Jpy is trading above its 100 hour M/A of 148.75. If it holds above this level look for a run up to the 200 hour M/A at 149.42. This level should provide good resistance as the 61.8% Fibo lies at 149.42 and an old data line of previous lows adds more resistance (149.43). The pair should be hard pressed to break above the 200 hour.

Sterling/Yen trading below Oct. 2nd low of 140.75

Gbp/Jpy is trading below Oct 2nd low of 140.75. The next level of support for the pair is 139.71 on downside, low from Sept. 28th. If the pair can get back above 140.75 look for a move above 141.00.

Gbp/Jpy not far off low

Gbp/Jpy is not far off session low of 141.90. Fibo retracement lies at 141.88, which has been a good level of support lately. On October 2nd the pair did break below and trade down to 140.75, but by end of that session returned above. If pair can hold it may push 143.00. A more likely scenario sees a break below and possible run down, maybe even below 141.00.

Sterling/Yen trading near 100 hour M/A

Gbp/Jpy has been trading near its 100 hour M/A. A break below could see the pair trade down to 142.55 which is the 50% Fibo support level. A break above could bring the pair back up to session highs around 143.90. With UK PMI coming out in next 10 minutes the pair could become volatile and break either to upside or downside depending on figure.

Gbp/Jpy finding it hard to break below support 141.88

Gbp/Jpy is having a hard time breaking the 61.8% Fibo support level of 141.88. It has flirted with this level several times this session. If it can break below it is very possible to see a steep decline down to 140.80 level. If the pair holds it should go back up to 142.60-70 level.

USDJPY moves through resistance in volatile trade

The USDJPY has moved through the resistance at the 90.68 level and is now testing the 100 hour moving average at the 91.00 level. A move above should lead to further gains with a target of 91.34 (38.2% retracement)  and above that the 91.61 to 91.72 area where the 200 hour MA and other low/high levels are found.

The Yen crosses are moving sharply higher which is helping the USDJPY in the process.  The GBPJPY moved through the September 2nd lows today at the 149.00 level but has has since moved sharply higher.  The 100 hour MA at the 150.89 is the next target.

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