GBP/JPY feeling gravity’s pull on Japan earthquake

Earthquake in Japan triggered speculation of repatriation flows, which pushed Yen higher across the board.

The GBP/JPY cross dropped to a session low of 137.88 before recovering to 138.20 levels. As per the latest reports, there is no threat of 2011-like event, although risk of aftershocks exists.

Nevertheless, a wave of Yen buying did hit the forex markets. Reports of an earthquake in New Zealand has hit the wires as well, however, markets are not reacting to the news, which is evident from the partial recovery in the GBP/JPY cross.

GBP/JPY Technical Levels

A break above 138.45 (Asian session high) would open doors for a revisit to 138.86 (previous day’s high), above which a major resistance is seen directly at 140.00 (zero figure). On the lower side, a failure to hold above 138.00 handle could yield a drop to 5-DMA level of 137.15. A break lower would expose 136.27 (previous day’s low).