GBPJPY Chart Technical Outlook resumes its gains on strong UK GDP, fresh rise in US yields implies further gains, 185.04 eyed, British data has been undoubtedly strong – GDP rose 0.2% in Q2, defying worries about stagnation, and June was robust with 0.5%, showing momentum. All sectors have expanded faster than expected. That boosts Sterling, improving its positioning.
What about the Yen? There is always a risk of intervention to strengthen the Yen, but I see it as unlikely today. I expect more impact from US yields.
When US yields rise, USD/JPY follows, and it also drags other Yen crosses higher with it. The same happens on the way down.
While US PPI will likely show soft factory gate inflation, the UoM Consumer Sentiment could show higher inflation expectations. Moreover, US bonds tend to sell off in the American session these days, pushing yields up and boosting Yen crosses.
Resistance is at the fresh high of 184.27, which almost converges with 184.36, the 138.2% Fibonacci extension of the 180.39-183.27 range.
