- A double-top threat for GBP/JPY
- GBP/USD forms Bull Flag formation, but near a formidable resistance.
- Employment numbers could swing the balance in favour of bulls or bears.
Equity markets rose during the Asia-Pacific trade shrugging off the escalation in the US-China standoff; ahead of the phase-one review on August 15.
Haven-linked Japanese Yen traded with gains while the US dollar nudged up from the last close.
A positive Chinese inflation data did little towards the movement in the trade-sensitive Australian Dollar, but the ASX 200 climbed up around one Percent, in tandem with the global equities.
GBP/USD awaits UK Job Numbers
If the June unemployment in the UK climbs above the market expectations of 4.2 Percent, GBP/USD could turn decisively lower. The job numbers have more significance than the usual as the 33.8 billion pounds worth furlough is being currently slowed down to cease by October finally.
Over 9 million workers have benefited from this program, and its premature withdrawal could result in more than 3 million jobless workers – an unemployment rate above 10 Percent, by the end of the year: according to the National Institute of Economic and Social Research.
GBP/USD will take a beating if job numbers surprise to the downside, estimating more monetary stimulus and thus lowering the pound’s inherent value against its competing currencies.
GBP/JPY Technical Outlook
The pair is poised to the downside, even though it is inside a bullish Schiff Pitchfork, but is close to forming a double-top reversal pattern – March high of 139.18.
Also, the RSI shows fading upside momentum and can attract sellers who might also be emboldened by the possible bearish MACD crossover.
The 61.8 Percent Fibonacci at 136.95 along with the 200-day MA of 136.25 can be a support for the GBP/JPY bulls to work it up.
GBP/USD is set for a possible short-term pullback after failing to cross its March high; RSI is below 70, and a potential MACD bearish crossover below its signal line is coming into play. But, traders might be bullish as recent price developments suggest more upside.