GBPJPY has sensed fresh demand around 165.10 on expectations of BOJ’s repeat intervention plans. (Pivot Orderbook analysis)

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• GBPJPY has sensed fresh demand around 165.10 on expectations of BOJ’s repeat intervention plans.
• UK’s recession situation will be two years longer than observed in the period of the global financial crisis.
• A firmer rebound in USDJPY may result in a repeat of BOJ’s intervention in the currency market.

The pair currently trades last at 165.8.

The previous day high was 168.58 while the previous day low was 165.09. The daily 38.2% Fib levels comes at 166.42, expected to provide resistance. Similarly, the daily 61.8% fib level is at 167.25, expected to provide resistance.

The GBPJPY pair has picked significant bids after testing Thursday’s low around 165.10 in the early Tokyo session. The cross has been supported despite the headwinds of risk-off impulse and deepening UK recession. The risk-off mood is extending its period as S&P500 futures have continued their downside momentum in the Tokyo session.

The asset has sensed fresh demand around 165.10 despite the bleak growth outlook in the UK economy due to a recession situation. In the monetary policy announcement by the Bank of England (BOE) on Thursday, BOE Governor confirmed that the UK economy is in recession and the situation will last potentially two years more than observed in the period of the subprime crisis.

BOE Governor hiked the interest rates by 75 basis points (bps) for the first time since 1989 as the inflationary pressures have settled above double-digit figures and are harming the economic prospects. Weaker economic prospects have left less room for more rate hikes as an attempt of the same would result in severe jobless numbers and claims that may dampen the economic situation.

On the Tokyo front, investors are worried about Japan-North Korea renewed tensions after North Korea fired an unidentified ballistic missile over Japan, as broadcasted by NHK. For safety measures, Japan administration warned residents to take shelter from missile threats. Apart from that, a firmer rebound in the USDJPY pair has triggered expectations for repeat intervention by the Bank of Japan (BOJ) to support the Japanese yen against sheer volatility.

Technical Levels: Supports and Resistances

EURUSD currently trading at 165.8 at the time of writing. Pair opened at 165.21 and is trading with a change of 0.36 % .

The pair is trading below its 20 Daily moving average @ 167.14, above its 50 Daily moving average @ 164.25 , above its 100 Daily moving average @ 163.95 and above its 200 Daily moving average @ 161.77

The previous day high was 168.58 while the previous day low was 165.09. The daily 38.2% Fib levels comes at 166.42, expected to provide resistance. Similarly, the daily 61.8% fib level is at 167.25, expected to provide resistance.

Note the levels of interest below:

• Pivot support is noted at 164.0, 162.8, 160.51
• Pivot resistance is noted at 167.5, 169.79, 170.99

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