The GBPJPY pair, at a rate of 178.876, has maintained its consecutive two-day rise due to strong expectations for additional differences in policy between Bank of England (BoE) and Bank of Japan (BoJ).

…
This is a premium post.
[s2If !current_user_can(access_s2member_level4)]Please register for FREE REGISTER to read full post below containing analysis. In case of any error or you think you are not able to read the full post below, please email us at support#nehcap.com [lwa][/s2If] [s2If current_user_can(access_s2member_level1)]

• GBP/JPY has continued its two-day winning streak due to solid hopes of further BoE-BoJ policy divergence.

The pair currently trades last at 178.876.

The previous day high was 177.44 while the previous day low was 176.45. The daily 38.2% Fib levels comes at 177.06, expected to provide support. Similarly, the daily 61.8% fib level is at 176.82, expected to provide support.

The GBP/JPY pair has stretched its rally to near 178.80 in the European session. The cross has extended its two-day winning streak as investors are hoping that the Bank of Japan (BoJ) will not alter its interest rate policy on Friday considering the fact that the Japanese economy needs monetary stimulus to elevate wages and the overall demand.

The asset is expected to continue its upside momentum as an unchanged interest rate decision by BoJ Governor Kazuo Ueda and a continuation of the rate-hiking regime by the Bank of England (BoE) would further widen the BoE-BoJ policy divergence.

BoJ Ueda is constantly reiterating the need for consistent monetary stimulus as historic high inflationary pressures in Japan are inspired by higher import prices. In order to maintain inflation steadily above 2% a tweak in the monetary policy is less likely.

Meanwhile, the odds of one more interest rate hike by the BoE have turned resilient further as United Kingdom’s labor market conditions have strengthened more and monthly Gross Domestic Product (GDP) is expanding and food prices are still near a 45-year high. Therefore, BoE Governor Andrew Bailey has no other option than to raise interest rates further.

Current UK inflation is at 8.7% on an annualized basis and can be tackled by the continuation of the interest rate hike spell. On Tuesday, BoE Governor Andrew Bailey assured that inflation will come down, but it will take longer than expected while speaking before the House of Lords Economic Affairs Committee.

Technical Levels: Supports and Resistances

GBPJPY currently trading at 178.82 at the time of writing. Pair opened at 177.38 and is trading with a change of 0.81 % .

The pair remains strongly bullish on the daily timeframe. It trades above its 20 SMA @ 173.77, 50 SMA 170.36, 100 SMA @ 166.02 and 200 SMA @ 164.97.

The previous day high was 177.44 while the previous day low was 176.45. The daily 38.2% Fib levels comes at 177.06, expected to provide support. Similarly, the daily 61.8% fib level is at 176.82, expected to provide support.

Note the levels of interest below:

• Pivot support is noted at 176.74, 176.1, 175.75
• Pivot resistance is noted at 177.73, 178.07, 178.71

[/s2If]
Nehcap Expert Advisor
The NEHCAP MT4 EA is high quality professional trading system geared to generate returns without using GRID or martingales. Each trade has strict risk per trade parameter. The pairs under management include EURUSD, GBPUSD, AUDCAD, AUDNZD,GBPAUD, EURAUD, EURCAD, CHFJPY and many more.
The system is trading live: LIVE ACCOUNT TRACKING
You can run it free. Apply for a free trial and track our account. Buy the system or use profit share mechanism to generate returns on your MT4.
Join Our Telegram Group