GBP/JPY fails to hold a daily break above the July high @ 149.31 once again
The overnight high touched 149.49 but price then fell into the close and once again there was no daily break above the July high @ 149.31. That has been the case that has plagued the upside move in the pair since September and failure to break above that can be rather hurtful for the pair now.
The yen continues to hold up well as equities sentiment remains soft but the pound is also hurt by the fact that a November Brexit deal is fast fading into oblivion. That’s a double whammy that threatens to derail the upside momentum seen over the past two weeks.
Of note, price is threatening a break of the 100-hour MA (red line) again and that will put an end to the near-term bullish bias in the pair. If sellers can hold a break below that, it presents a move to test the 23.6 retracement level @ 147.91 before heading towards a test of the 6 November low @ 147.31.
Things are beginning to fall apart for pound pairs with cable also having broken below the 100-hour MA yesterday. If the Q3 preliminary GDP data to come doesn’t help to give a meaningful lift to the pound, expect the downside move here to resume and I’d be looking towards that 200-hour MA (blue line) @ 146.89 as the area where buyers have to make their stand otherwise it precipitates a major fall back towards last month’s low again.