• The BoE left interest rates unchanged as expected at the last meeting
  removing the tightening bias but reaffirming that they will keep rates high for
  sufficiently long to return to the 2% target.
• The employment report beat expectations across the board
  with a positive revision to the December’s negative payroll figure.
• The UK CPI missed expectations across the board but with
  Services inflation remaining sticky, which continues to support the BoE’s
  patient stance.
• The latest UK PMIs showed the Manufacturing sector improving but
  remaining in contraction while the Services sector continues to expand.
• The latest UK Retail Sales beat expectations across the board
  by a big margin.
• The market expects the first rate
  cut in June.

JPY

• The BoJ kept its monetary policy unchanged as expected with interest rates at
  -0.10% and the 10 year JGB yield target at 0% with 1% as a reference cap.
• The Japanese CPI eased further across all measures
  which makes it even harder to expect a rate hike from the BoJ anytime soon.
• The latest Unemployment Rate ticked lower hovering around cycle
  lows.
• The Japanese PMIs improved for both the Manufacturing
  and Services measures although the former remains in contractionary territory.
• The Japanese wage data missed expectations again recently
  although there was a pick up from the prior reading.
• The Tokyo CPI, which is seen as a leading
  indicator for National CPI, fell much more than expected recently.
• The market expects the BoJ to hike
  rates in Q2.

GBPJPY Technical Analysis –
Daily Timeframe

On the daily chart, we can see that GBPJPY broke
through the cycle high and started to consolidate. The buyers should keep on
leaning on the 188.67 level to position for new highs while the sellers will
want to see a breakdown to start targeting new lows.

GBPJPY Technical Analysis –
4 hour Timeframe

On the 4 hour chart, we can see that the 188.67
level is now a key support zone where
we can also find the confluence with the
trendline and the
red 21 moving average. This is
where we can expect the buyers to step in with a defined risk below the
trendline to position for new highs. The sellers, on the other hand, will want
to see the price breaking lower to invalidate the bullish setup and position
for a drop into the 185.21 level.

GBPJPY
Technical Analysis – 1 hour Timeframe

On the 1 hour chart, we can see that the
price action has been pretty choppy recently but overall the pair kept on
printing higher lows as the buyers remained in control. The sellers should wait
for a break below the key support to regain control and have more conviction
for new lows.

Upcoming Events

Today we have the FOMC Meeting Minutes on the agenda
while tomorrow we get the latest UK and US PMIs, and the US Jobless Claims
figures.

This article was written by FL Contributors at www.forexlive.com.