The Pound is seen to have managed to strengthen slightly in the initial reaction to the release of the United Kingdom's (UK) crude output data (GDP) before displaying a more pronounced depreciation afterwards.
The UK economic growth reading shows a close for the second quarter but the published figures are seen as slightly favorable against expectations for further declines.
It was also the first in more than a year and compared to the market forecast for a fall to -0.2%.
Some UK economic sector data was also published alongside the GDP data such as industrial and manufacturing spending with the overall reading rated as somewhat dismal although better than forecast.
If you look at the price movement on the GBP/JPY chart, the price has shown a downward pattern on Wednesday and Thursday trading overnight with a weekly low that was broken overnight around 161,300.
However, the price rebounded above the 162,000 zone and tested the 50 Moving Average (MA50) barrier level on the 1 hour timeframe on the GBP/JPY chart so that the focus is on UK GDP data earlier in the European session.
The initial rise as well as the reaction to the data saw the price to a level around 162,800 before the price fell back to the 162.00 zone, continuing the movement in the European session with the initial sign of a trend change.
Has zone 162.00 managed to replay the price? Or will the price drop even lower?
Should the price continue to dip below the 162,000 zone, a new weekly low is likely to hit prices after overcoming the levels that were broken last night.
A clearer bearish move in price has seen the price reach its previous peg around 160,500 or lower at 160,000 testing the support zone in early August.
On the other hand, if the price bounces back up again, this week's resistance level at 163,500 will be tested before the price overcomes it to target an increase to the level of 164,500.
After the signal for the bullish pattern is considered as a conduit, the continued price increase has the potential to re-break the high of 166,200 which became an obstacle to be tested at the end of last July.
