In this GBPJPY analysis, we decipher the currency pair from technical and fundamental aspects. It also features trend examination, price forecasts, support and resistance levels, and trading signals.
We update our GBPJPY analysis page daily to ensure you have the latest information, covering the latest news and price changes.
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GBPJPY News: FTSE Hits Record High as Market Awaits BoJ Meeting
Following up on the latest news about the British and Japanese economies is essential because these developments can significantly impact price movements.
By combining the major economic indexes with technical tools, analysts can make informed decisions while keeping trading risks at their lowest.
FTSE 100 Hits Record High at 8550 Points
Source Bloomberg—The FTSE 100 rose by 0.3% to close at a record high of 8,550, supported by a weaker pound and strong performance in the banking sector. Lloyds Banking Group led the gains, jumping 4% after reports suggested that Chancellor Rachel Reeves might intervene in the motor finance inquiry to limit losses.
Endeavour Mining also climbed 3%, benefiting from higher gold prices driven by global uncertainty under the new US administration. Other notable gainers included AstraZeneca, National Grid, Barclays, and BAE Systems.
Conversely, major mining companies like Glencore, Anglo American, and Rio Tinto experienced declines of up to 1.7%. Pershing Square Holdings, AB Foods, and Rightmove also recorded losses.
In economic data, UK unemployment increased to 4.4% in November, while wages grew faster at 5.6%. This has added to the uncertainty over the Bank of England’s next policy moves.
BOJ Meeting in Focus as Japan’s Bond Yield Climbed %1.2
Japan’s 10-year government bond yield climbed above 1.2% on Wednesday, recovering from recent lows. This rise reflects growing speculation that the Bank of Japan (BOJ) might raise interest rates soon, influenced by recent hawkish signals from central bank officials.
If implemented, the rate hike would push short-term borrowing costs to 0.5%, a level not seen since the 2008 financial crisis. BOJ Governor Ueda hinted that rate increases could be on the table if the economy remains strong.
Deputy Governor Himino also noted that keeping real interest rates negative would be unusual after Japan moves beyond deflation. Additionally, the BOJ will likely revise its inflation forecast upward, as rising wages could help Japan achieve its long-term 2% inflation goal.
GBPJPY Fundamental Analysis: Japanese Yen Has the Advantage
Based on recent economic data, the Japanese Yen has the upper hand against the British Pound. The Japanese central bank will likely increase interest rates, which could boost the Yen against other currencies.
GBPJPY Analysis: Overbought Stochastic Signals Reversal
The British Pound has been trading in a bear market against the Japanese Yen since Monday, December 30, 2024, after the pair targeted 199.0. Consequently, GBP/JPY lost 4.8% of its value and dropped to 189.5, a support area backed by the September 30 low. But, the downtrend eased, and the pair began consolidating from 189.4.
As of this writing, GBP/JPY had bounced off the 189.5 support level and erased 1.6% of its recent losses, stabilizing above the 23.6% Fibonacci retracement level.
The primary trend is bearish because GBP/JPY trades below the 50- and 100-period simple moving averages.
The Awesome Oscillator histogram is green, above zero, meaning the uptrend strengthened.
The Stochast value is 90.0, hovering in the overbought territory. This means the British pound is overvalued against the Yen.
The relative strength index indicator (RSI 14) value is 55.0 and declining, signaling the bull market weakens.
Overall, the technical indicators suggest that the GBPP/JPY primary trend is bearish and should resume.
GBPJPY Forecast: Downtrend Resumes Below 191.5
The immediate support is at 191.7. Due to the overbought signal given by the Stochastic Oscillator, GBP/JPY has the potential to resume its bearish trajectory. However, bears should push the prices below 191.7 to trigger the downtrend, a support level backed by the 23.6% Fibonacci.
If this scenario unfolds, the currency pair will likely target the January 17 low at 189.5. Please note that the 50.0% Fibonacci retracement level at 194.2 stands between a bear market and a bull market.
The GBP/JPY trend outlook remains bearish as long as the prices are below 194.2, a robust resistance level backed by the 100-period simple moving average.
GBPJPY Support and Resistance Levels
Monitoring key support and resistance levels in Forex trading is crucial because they illuminate potential entry and exit points. Support levels indicate where a trading product may stop its downtrend and start to rise, acting as a floor, while resistance levels signal where it may stop growing and begin to fall, acting as a ceiling.
The table below demonstrates the key support and resistance levels for the GBPJPY currency pairs. Understanding these supply and demand zones can boost technical analysis and future price prediction.
| GBP/JPY Support and Resistance Levels | |||
|---|---|---|---|
| Support | 191.7 | 189.5 | 188.0 |
| Resistance | 193.0 | 194.2 | 195.3 |
GBPJPY Economic Calendar
Technical analysis aside, which is vital for triggering an order in the Forex market, economic news is the Fundamentals of price movements. We use reliable resources to investigate the latest financial updates before our analysts draw lines on the chart.
The table below lists the economic events for the GBPJPY currency pair, including all important and high-impact news relevant to the United Kingdom and Japan. Click on each event to expand it for more details.
This economic calendar is a widget from TradingView, a trustworthy financial news source.