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Forex: GBP/JPY consolidation continues as longer term trend remains bullish

FXstreet.com (Barcelona) - The GBP/JPY is edging lower during the Asia session, down 28 pips at 155.50. The previous day saw some important economic data out of the UK, including the Claim Count Report, as well as the Bank of England’s latest Inflation Outlook Report. Later on in the Asia session we will see a few reports from Japan including Industrial Production and Capacity Utilization.

From a technical perspective, the pair looks to be going through a healthy consolidation on the daily chart after the sharp moves higher from the previous week. Short term moving averages remain in bullish set up, with price above both the 9 and 20dma’s. Also, the RSI (14) remains in bullish set up, consolidating just above the 60 level. On a final note, the ‘pennant’ continuation pattern which was confirmed last week with the close above 153.50 (on May 3rd) remains intact and still points to targets as high as 160.75. Initial resistance sits at 156.50 (supply on 1 hour chart), while support sits at 155.03 (the 9dma).

Forex: EUR/USD capped below 1.2900

EUR/USD is currently trading at 1.2876, off session lows at 1.2870, capped below late NY session highs at 1.2894, where stop losses are placed now. “There are some very tight trailing stops now above 1.2895 in the EUR/USD (mainly from leveraged types) which will probably be targeted in the next few hours,” noted FXWW founder Sean Lee.
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