GBP/JPY holding just above 148.00, looking for earnings to revive a hawkish BoE
- Sterling looking for a boost to kick off the new week.
- Monday promises quiet action ahead of Tuesday's earnings figures.
The Sterling is lifting against the Yen in early Monday action, trading into 148.35 ahead of the upcoming London market session.
The GBP/JPY traded into a fresh low last week, but managed to halt the decline. Upward momentum is being capped just beneath the 200-day SMA as the Bank of England (BoE) struggles to halt the GBP's decline after the central bank had to take a dovish turn and hold off on a widely-expected interest rate hike in May as economic figures for the UK continue to falter.
The Sterling's decline on the back of the first quarter's poor performance could be overplayed, and the BoE expects macro figures for the economy to rebound.
Monday is a quiet showing for the Sterling, but Tuesday will be bringing earnings figures at 08:30 GMT, and traders will be watching the numbers closely for signs of a recovery for the BoE's former hawkishness. Earnings excluding bonuses is expected to tick up from 2.8% to 3.1%, but a miss could send the Sterling reeling once more.
GBP/JPY levels to watch
A bullish correction is going to face stiff downward pressure, as FXStreet's own Flavio Tosti noted: "the medium-term trend is bearish and the market is trading below the 50, 100 and 200-period simple moving averages (4-hour chart) suggesting a strong downward momentum. Support is seen at the 148.00 figure and the 147.50 level, Thursday low, followed by the 147.00 swing low and figure. To the upside, resistance is seen at 148.50, high of the day and at the 149.30, Thursday’s high."