GBP/JPY is trading stable near 180.00 after falling almost 300 points, BOJ intervention rumored

• The GBP/JPY pair sank almost 300 points early on Tuesday before bouncing back to 180.00.
• Market rumors about the BOJ’s intervention in currency markets will have to wait to be confirmed by official sources.
• This week the economic calendar remains practically empty for both the Pound and the Yen.

Early on Tuesday, the pair GBP/JPY It completely collapsed, falling almost 300 points in sixty seconds, until it was just below 178.00 points. Markets are widely assuming that the Bank of Japan (BoJ) intervened in global currency markets in an effort to defend the Japanese Yen (JPY), but investors will have to wait for any official confirmation from government sources.

The Guppy’s high-low price range exceeds 1.8% on Tuesday, and GBP/JPY is stuck in the main 180.00 zone after retracing more than 50% of the rumored intervention drop.

The economic calendar will be empty for the entire trading week for both the British Pound (GBP) and the Yen. The closest thing to a notable data this week will be the annualized Japanese labor cash earnings for August, scheduled for late Thursday at 23:30 GMT. Japanese job gains were last at 1.3%, and lower-than-expected wage growth could push the Bank of Japan even further away from future rate hikes, as the Japanese central bank prepares to see if the Inflation falls below its 2% target.

GBP/JPY Technical Outlook

The GBP/JPY pair has been trading lower despite rumored JPY market intervention, and has fallen below the 100-day SMA for the first time since late March.

The Guppy is down over 3.5% from the August high at 186.75, and the complete lack of buying conviction in the Sterling market flows will cause GBP/JPY to lose its balance and fall towards the 200-day SMA which is currently pushing higher from 172.00.

GBP/JPY daily chart

GBP/JPY technical levels