With the yen strengthening, market participants are keeping a close eye on the pound, which is holding up well
27.10.2022
- ECB Policy Rate and Statement Release
- Press Conference by ECB President Lagarde
The previous day, the U.S. dollar became the weakest currency as the Dollar Index fell below the key 110 level to 109.7. GBP/USD rose by approximately 200 pips from 1.1431 to 1.1638, forming an uptrend along the 10-period moving average on the hourly chart.On the 4-hour chart, the pair has already broken above the 200-period SMA, and on the daily chart, it is positioned just below the 75-period MA. It will be worth watching whether the pair will rise from its current level of 1.1607 after a corrective pullback.
Amid a strengthening yen, the pound held its ground against the yen. GBP/JPY rose by about 120 pips from 169.292 to 170.597, breaking through the key 170-yen level to hit a new high for the year.Since the daily RSI has not yet reached the overbought level of 70 and there is still some room to move, we will be watching closely to see if economic data releases during European trading hours drive the pair higher. However, on the hourly chart, the RSI has shown a short-term reversal, so we should remain cautious of a corrective decline.
Today’s schedule includes the German GfK Consumer Confidence Survey at 3:00 PM Asia time; Turkey’s trade balance at 4:00 PM Europe time; the ECB’s policy rate decision and statement at 9:15 PM Europe time; U.S. initial jobless claims, third-quarter GDP, and personal consumption at 9:30 PM U.S. time;U.S. Core PCE Deflator, U.S. Durable Goods Orders, at 21:45 the ECB President Lagarde’s press conference, at 23:30 U.S. weekly natural gas inventories, at 24:00 the U.S. Kansas City Fed Manufacturing Activity Index, and at 26:00 a U.S. 7-year Treasury auction. With the yen strengthening, we will be closely monitoring the movement of the pound, which is showing solid support on the downside.
Author: Keisuke Sakurai
