#GBPJPY @ 161.213 edges lower for the second straight day, though lacks follow-through selling. (Pivot Orderbook analysis)

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• GBP/JPY edges lower for the second straight day, though lacks follow-through selling.
• Recession fears, expectations for a hawkish BoJ shift underpin the JPY and caps gains.
• Bets that the BoE’s current rate-hiking cycle is nearing the end favour bearish traders.

The pair currently trades last at 161.213.

The previous day high was 162.12 while the previous day low was 160.79. The daily 38.2% Fib levels comes at 161.3, expected to provide resistance. Similarly, the daily 61.8% fib level is at 161.61, expected to provide resistance.

The GBP/JPY cross remains on the defensive for the second straight day on Thursday, albeit manages to hold above the overnight swing low. The cross trades around the 161.20 region heading into the European session and is influenced by a combination of diverging forces.

A modest US Dollar weakness assists the British Pound to gain some positive traction, which, in turn, is seen lending some support to the GBP/JPY cross. The Japanese Yen (JPY), on the other hand, is underpinned by speculations that the Bank of Japan (BoJ) governor candidate Kazuo Ueda will dismantle the yield curve control. Apart from this, looming recession risks further benefit the JPY’s relative safe-haven status and act as a headwind for the cross.

Furthermore, expectations that the Bank of England’s (BoE) current rate-hiking cycle is nearing the end hold back traders from placing bullish bets around the British Pound and cap the GBP/JPY cross. The bets were lifted by softer-than-expected UK consumer inflation figures released on Wednesday, which could allow the UK central bank to soften its stance. This, in turn, favours bearish traders and supports prospects for some meaningful downside for the cross.

That said, the lack of any strong follow-through selling warrants some caution in the absence of any relevant market-moving economic releases from the UK. Hence, it will be prudent to wait for a sustained break below the overnight swing low, around the 160.65 region, before confirming that the GBP/JPY pair’s recent move-up witnessed over the past two weeks or so has run its course.

Technical Levels: Supports and Resistances

GBPJPY currently trading at 161.19 at the time of writing. Pair opened at 161.39 and is trading with a change of -0.12 % .

The pair is trading above its 20 Daily moving average @ 159.98, above its 50 Daily moving average @ 160.87 , below its 100 Daily moving average @ 163.6 and below its 200 Daily moving average @ 163.24

The previous day high was 162.12 while the previous day low was 160.79. The daily 38.2% Fib levels comes at 161.3, expected to provide resistance. Similarly, the daily 61.8% fib level is at 161.61, expected to provide resistance.

Note the levels of interest below:

• Pivot support is noted at 160.75, 160.1, 159.42
• Pivot resistance is noted at 162.07, 162.76, 163.4

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