Amid a rising number of confirmed cases of the coronavirus, the Nikkei 225 closed with a 227.4-point or 0.99% profit at 23,205.2. On the other hand, the Hang Seng Index continued to trade in the red today but losses were not as dire as yesterday. As of this writing, Hong Kong stocks are down by over 60 points or 0.24% at 26,384.1. Meanwhile, The Shanghai Composite Index was still closed for the Chinese New Year today but will re-open on Monday.
Earlier today, it was reported that China’s manufacturing PMI report for January printed at 50.0. While it missed the forecast at 50.1, the reading matches the baseline number that denotes expansion. Meanwhile, the non-manufacturing PMI report for the month printed at 54.1 versus the 53.1 consensus. Both readings hint that the manufacturing and services sectors of China continue to expand. However, it’s worth pointing out that these data do not take into consideration the coronavirus outbreak which began later this month.
As of this writing, the confirmed cases are up at 9,776 and the death toll is at 213. WHO has already called a “global health emergency” as it has already surpassed the number of infected individuals during the SARS outbreak of 2003.
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GBPJPY Outlook
On the daily time frame, we can see that GBPJPY bounced off support around 141.20 yesterday. The reversal candles which have already materialized around this level could indicate that GBPJPY may soon rally to 144.50, where it peaked last week.
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However, a closer look at the 4-hour time frame shows that the currency pair could find resistance at the 143.00 psychological handle. For one, this price aligns with both the 100 SMA and 200 SMA. When you draw the Fibonacci retracement tool from the high of January 22 to the low of January 30, the price also coincides with the 50% Fib level. If GBPJPY fails to close above the SMAs, it could indicate that the currency pair has room to trade lower. It could fall to yesterday’s low around 141.25.More content
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