GBP/JPY has settled at 171.86, waiting for UK data releases

FXStreet (Moscow) - GBP/JPY is paralyzed in a narrow range around 171.86 in Asia as market players are waiting for a number of important releases tom the UK.

GBP/JPY is apprehensive

GBP/JPY is trying to reverse heavy losses incurred during the previous week, but it is not too successful in its endeavors as GBP selling pressure across the board limit its gains. The cross has had two positive days in a row and recovered from Monday open at 171.26 to 171.89 due to eased risk aversive sentiments that supported JPY buying. Though today the situation may change quite abruptly as we have BOE inflation report and labour market statistics published during European hours. Unemployment rate is going to decrease, but investors would be much more interested in average earnings as it is the only labour market metrics that makes BOE feel uncomfortable. Sings of weak wage growth might trigger another wave of GBP selling across the board and push GBP/JPY back to 171.26. Though tread carefully as GBP is strongly oversold and good or in line with expectations data might initiate profit taking.

What price levels and patterns have to be considered?

Spot is presently trading at 0.8425, and next resistance can be seen at 0.8432 (Hourly 20 EMA), 0.8435 (Daily Open), 0.8435 (Monthly Low), 0.8435 (Weekly Low) and 0.8435 (Daily Classic PP).

Support below can be found at 0.8418 (Daily Low), 0.8412 (Weekly Classic S1), 0.8407 (Yesterday's Low), 0.8407 (Daily Classic S1) and 0.8378 (Daily Classic S2).