#GBPJPY @ 160.377 jumps more than 200 pips on BoJ status-quo. (Pivot Orderbook analysis)

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• GBP/JPY jumps more than 200 pips on BoJ status-quo.
• Bank of Japan left benchmark rate, YCC policy unchanged despite high expectations.
• Yields drop, US stock futures regain upside momentum on BoJ move.
• BoJ Governor Kuroda’s speech, UK CPI, RPI for December will be watched for clear directions.

The pair currently trades last at 160.377.

The previous day high was 158.03 while the previous day low was 156.4. The daily 38.2% Fib levels comes at 157.41, expected to provide support. Similarly, the daily 61.8% fib level is at 157.02, expected to provide support.

GBP/JPY braces for the biggest daily gains in two weeks after the Bank of Japan (BoJ) disappointed the Yen buyers during early Wednesday. Adding strength to the cross-currently pair’s upside momentum could be the hopes of upbeat inflation data from the UK.

BoJ announces no changes to their monetary policy settings in December, maintaining rates at -10bps and the 10-yr Japanese Government Bond (JGB) yield target unchanged at 0.00%. Other than the absence of change in the BoJ’s Yield Curve Control (YCC) policy and the intact rates, the BoJ’s quarterly outlook report also allowed the GBP/JPY pair to brace for the biggest daily upside since mid-June 2022.

In a reaction to the BoJ’s disappointment, the US Treasury bond yields reverse the early-day rebound to drop towards 3.50% while the S&P 500 futures print 0.30% intraday gains, following the mildly negative marks of the intraday performance.

Although the BoJ has already disappointed the GBP/JPY bears, traders will pay attention to Governor Haruhiko Kuroda’s speech as the policymaker may convey his dislike for the YCC policy after it pushed the Japanese central bank to spent roughly 6% of the Gross Domestic Product (GDP) defending its yield target in the last month alone.

Following that, the UK’s Consumer Price Index (CPI) and Retail Price Index (RPI) for December will be crucial after the British jobs report impressed the Sterling buyers the previous day.

Also read: UK Inflation Preview: Another soft CPI to hit Pound Sterling, here’s why

Despite crossing the downward-sloping resistance-turned-support line from early December, close to 159.40 by the press time, as well as the 160.00 round figure, a three-week-old resistance line near 160.65 challenges the GBP/JPY bulls.

Technical Levels: Supports and Resistances

GBPJPY currently trading at 160.2 at the time of writing. Pair opened at 157.43 and is trading with a change of 1.76% % .

The pair is trading above its 20 Daily moving average @ 159.23, below its 50 Daily moving average @ 163.56 , below its 100 Daily moving average @ 164.08 and below its 200 Daily moving average @ 163.59

The previous day high was 158.03 while the previous day low was 156.4. The daily 38.2% Fib levels comes at 157.41, expected to provide support. Similarly, the daily 61.8% fib level is at 157.02, expected to provide support.

Note the levels of interest below:

• Pivot support is noted at 156.54, 155.66, 154.91
• Pivot resistance is noted at 158.18, 158.92, 159.81

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