Market participants are keeping a close eye on the resilience of the GBP/JPY pair, which rebounded to the 7-yen level after a sharp drop to 7.6 yen

Market participants are keeping a close eye on the resilience of the GBP/JPY pair, which rebounded to the 7-yen level after a sharp drop to 7.6 yen

06.08.2024

In the previous day's U.S. currency markets, the U.S. dollar weakened amid a global sell-off that included stock prices. It fell against the euro.The EUR/USD pair rose from 1.8092 to 1.1008, touching the +3σ line of the hourly Bollinger Bands. On the 4-hour chart, the RSI has risen to 70, and on the daily chart, the pair continues to rebound from the support line of the 200-day SMA. We will need to watch price movements during European trading hours to see if the US dollar continues to weaken against the euro.

Among European currencies, the pound weakened from European to U.S. trading hours. GBP/JPY fell from 187.684 to 180.092, plunging to the -3σ level of the hourly Bollinger Bands.On the 4-hour chart, the RSI fell to 11. The daily chart showed a similar reading, with the pair dropping to the yen-strength levels seen on January 3 of this year. However, as a rebound has been observed during today’s Asian session, we will be watching closely to see if the rebound continues into the European session.

Today’s economic indicators include the RBA policy rate and statement at 1:30 PM, RBA Governor Block’s press conference at 2:30 PM, the Swiss unemployment rate at 2:45 PM, German manufacturing orders at 3:00 PM, Swiss retail sales at 3:30 PM, the UK construction PMI at 5:30 PM, and Eurozone retail sales at 6:00 PM.at 9:30 PM, Canada’s trade balance and the U.S. trade balance; at 2:00 AM, the U.S. 3-year Treasury auction; and at 7:45 AM the following day, New Zealand’s Q2 unemployment rate. I want to carefully assess the resilience of the GBP/JPY pair, which rebounded to the 7 yen level after a sharp drop to 7.6 yen.