GBPJPY, Daily
Sterling suffered on Friday from reports on Bloomberg that the UK finance minister (Philip Hammond) is ready to accept the fact that the UK may have to give up single-market membership in the European Union to achieve the immigration restrictions voters demanded in the Brexit vote. Cable closed the day and week down 1.8 percent and GBPJPY slumped from north of 135.00 to close under 133.00.
The slip in sterling has helped both our SHORT GBP trades reach Target 2 – GBYJPY (132.80) and GBPUSD (1.3070) for a net gain on both trades of over 600 pips.
Today the USD has traded softer and corrected some of its outperformance from Friday, Market conditions have been thin with Tokyo markets absent and with market participants largely on the sidelines ahead of the Fed and BoJ policy decisions this week. USDJPY ebbed back under 102.00, breached Friday’s low on route to a four-session low at 101.69. EURUSD traded in a narrow orbit of 1.1150. Cable recouped some of the sharp losses seen on Friday, lifting above 1.3080, well over half a big figure up on the day.
However, the close of the day and week below the psychological 1.3000 level is definitely one to watch. Next break lower would be the August low of 1.2860, the post Brexit low of 1.2780 and then 1.2500.
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Stuart Cowell
Market Analyst
HotForex
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