GBP/JPY climbs further beyond 138.00 handle, closer to 1-1/2 week tops
|- Fading safe-haven demand continues to weigh on the JPY and helped regain traction.
- The GBP picks up the pace following the release of upbeat UK wage growth data.
- Comments by BoE’s Michael Saunders remained support of the positive momentum.
The GBP/JPY cross jumped back above the 138.00 handle in the last hour, with bulls now awaiting a follow-through move beyond 1-1/2 week tops set in the previous session.
The cross failed to sustain/build on its weekly bullish gap on Monday and witnessed a sharp intraday pullback following the disappointing release of UK macro data - more importantly, an unexpected GDP contraction for the second consecutive month in April.
However, the prevailing risk-on environment continued weighing on the Japanese Yen's safe-haven status and helped the cross to regain positive traction on Tuesday. Meanwhile, the British Pound picked up the pace following the release of better-than-expected UK average earnings growth data.
The positive momentum got an additional boost in the wake of hawkish comments by BoE MPC member - Michael Saunders, reiterating that the UK could see more rate hikes and at a faster rate than the curve implies if Brexit is smooth.
It, however, remains to be seen if bulls are able to capitalize on the positive move or the cross once again fizzles out at higher levels amid expectations that a hard-line Brexiteer could be the next British PM and could lead to a no-deal split.
Technical levels to watch
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.