Can GBP/JPY Hold This Crucial Support?

Key Highlights

• The British Pound corrected lower from 150.58 but it found support near 148.80 against the Japanese Yen.
• There is a significant ascending channel forming with support near 148.80 on the 4-hours chart of GBP/JPY.
• The pair remains in an uptrend as long as it is above the 148.80 support.
• Today, the UK Manufacturing PMI for March 2018 will be released, which is forecasted to decline from 55.2 to 54.5.

GBPJPY Technical Analysis

The British Pound is following a major uptrend from the 145.00 swing low against the Japanese Yen. The GBP/JPY pair traded towards 150.60 recently before correcting lower towards 148.80.

Looking at the 4-hours chart, there is a significant ascending channel forming with support near 148.80 on the same chart. The best part is the fact that the pair is still above the 100 (red) and 200 (green) simple moving averages (4-hours).

The pair tested the channel support recently, formed a base near 149.00 and is currently moving higher. It has moved above the 23.6% Fib retracement level of the last decline from the 150.58 high to 148.83 low.

However, the pair failed to break the 149.70 resistance and the 50% Fib retracement level of the last decline from the 150.58 high to 148.83 low. At the moment, the pair is trading near the channel support at 148.70-80 and it is at risk of more declines.

On the downside, the 148.70-80 support area holds a lot of importance, followed by the 100 (red) and 200 (green) simple moving averages (4-hours).

Only a close below the 100 SMA and the 148.50 level may push the pair in a bearish zone. Below 148.50, the pair may test the next support at 147.00. The overall price structure is neutral to positive as long as the pair is above the 148.50 level.

Economic Releases to Watch Today

• Germany’s Manufacturing PMI for March 2018 – Forecast 58.4, versus 58.4 previous.
• Spanish Manufacturing PMI for March 2018 – Forecast 54.9, versus 56.0 previous.
• Euro Zone Manufacturing PMI March 2018 – Forecast 56.6, versus 56.6 previous.
• UK Manufacturing PMI for March 2018 – Forecast 55.2, versus 54.5 previous.