More Downsides Likely In GBPJPY

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There British pound moved lower not only against the US dollar, but also against the Japanese yen. On one hand the GBPUSD pair traded below the 1.50 level and on another the GBPJPY pair broke the 181.00 support area to challenge the 180.00 support area. There were some important releases in Japan earlier during the Asian session. The Japanese Industrial Production representing outputs of the Japanese factories and mines was released by the Ministry of Economy, Trade and Industry. The outcome was on the lower side, as the Japanese Industrial Production declined by 2.8% in January 2015, compared to the same month a year ago. The last reading was of a 1% gain.

There is a minor bearish trend line formed on the hourly chart of the GBPJPY pair, which might act as a hurdle if the pair jumps sharply higher from the current levels. Currently, the pair is finding buyers around the 180.00-50 support area. So, there is a chance that the pair might move higher in the near term. However, initial resistance can be seen around the 23.6% fib retracement level of the last leg from the 183.090 high to 180.20 low. The most important one is around the 38.2% fib retracement level, which is sitting around the highlighted trend line. The hourly RSI is still below the 50 level suggesting bearish pressure on the pair.

GBPJPY 03.13.2015

If the GBPJPY pair moves lower from the current levels, then the last low of 180.20 level might come into play again.

Overall, one might consider selling rallies in the GBPJPY pair as long as it stays below the highlighted trend line.

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