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The dollar lost a few more pips against most of its major counterparts though price action was muted on a lack of market-moving catalysts.

Think the U.K.’s labor market numbers will provide some volatility?

Before I show you what’s up on GBP/JPY’s chart, check out the top headlines that dominated the past trading sessions:

Major Forex Pairs Price Performance from MarketMilk
Major Forex Pairs Price Performance from MarketMilk

Upcoming Potential Catalysts on the Economic Calendar:

  • U.K.’s labor market numbers at 7:00 am GMT
  • Switzerland’s PPI at 7:30 am GMT
  • Eurozone’s final CPI at 10:00 am GMT
  • U.K.’s CBI realized sales at 11:00 am GMT

What to Watch: GBP/JPY

GBP/JPY 1-hour Forex Chart
GBP/JPY 1-hour Forex Chart

The U.K. is set to print its January labor market numbers and, if the event calendar is right, we could see improved earnings and job additions but a slightly higher unemployment rate.

Better-than-expected numbers could boost GBP/JPY from a trend line support that has been supporting the bulls since last week. Of course, it also helps that vaccinations in the U.K. and Boris Johnson’s plans to reopen schools in March are fueling recovery-related optimism.

Watch out for the 148.25 zone, though, as the area looks ripe for some short-term profit-taking.

If the U.K.’s jobs market turns out weaker than analysts are expecting, though, then we could see GBP/JPY break below the trend line AND the 200 SMA on the 1-hour time frame.

A convincing break could drag the pound all the way to the 146.50 minor psychological handle that lines up with a key February support