Tuesday is scheduled to be a quite important day for the UK. At the yesterday's session, the pound rose against USD on the background of weak data from the US. The cable grounded towards the lowest level since mid-2013. The cable made a low at 1.47000. At the yesterday's session, the cable paused its 4 days losing trend and gave a strong close. We recommended buying with sl 1.4738 at the yesterday's session. The pair made a high at 1.4854. Today, traders eye on data from the US building sector. We hinted 500 pips fall, in case the price close below the level of 1.4810. But the event does not occur yet. The EUR/GBP cross is also weighing on the pound. The eurozone is the UK's major trading partner. The UK is slowly approaching its general election scheduled for May. Market participants expect the pound to get under a downward pressure. The prices are trading in a bearish channel. A strong resistance is seen at 1.4945. Until the price closes below 1.4945, a bearish view remains in play. Intraday support is likely to be found at 1.4780. We recommend selling below 1.4770 with targets at 1.4740, 1.4700, and 1.4580 in the near term and at 1.4350 in the medium term. We expect the pair to hit 1.4350 or 1.4200 before May/June. We expect the bottom to be formed After the UK's election. The pound is likely to start moving towards new lows in case of stronger-than-expected data from the US.
Trade: Selling below 1.4770, safe traders selling below 1.4730
Buying above 1.4860
GBP/JPY
The Bank of Japan has just released monetary policy meeting minutes.The BOJ kept stimulus unchanged. The Bank is going to purchase Japanese government bonds (JGBs), so their outstanding amount will increase at an annual pace of about 80 trillion yen. Regarding the outlook, the economy of Japan is expected to continue its moderate recovery trend. The year-on-year rate of increase in the CPI is likely to be about 0 percent for the time being, due to the effects of a decline in energy prices.
At the yesterday's session, the cable paused its 4 days losing trend and gave a strong close. The pound traded higher against USD & JPY at the yesterday's session. At the today's Asian session, the pound is trading lower against USD and higher against JPY. The cross is trading in the support zone around 177.95 and 177.80, 200Dema, and 200Dsma respectively. Monthly support is found at 176.70 50Wsma. Weekly resistance is seen at 181.50 and 181.65. The panic will be triggered in case the price closes below 177.80. The cross closes below 50Dsma, represents near and short-term outlook remains bearish. On a weekly basis, the cross closes below 20Wsma and is trading below it. Until the price closes below 181.30, the bearish view remains in play. Intraday resistance is seen at 180.20. Intraday support is found at 179.60 and 179.10.
Trade: selling below 179.60 with targets at 179.10,178.90 and 178.70.
Panic below 177.80.
Levels to watch- 177.95 177.80 last hope at 177.60. These are valid for this week.
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