GBP/JPY bears break below 138 handle, playing catch up with Sterling's weakness

Ross J Burland FXStreet

Currently, GBP/JPY is trading at 137.64, down -0.54% on the day, having posted a daily high at 138.52 and low at 137.60.

Forex today: improved risk sentiment across the board, GBP/USD worst performer

Sterling crosses are taking a beating with GBP/JPY playing catch-up with the rest of the cross's bears first out of the blocks - that would be GBP/AUD. However, cable is now testing critical support levels on this move.

UK PM May signs Article 50 letter

The UK PM Theresa May has already signed the letter and the British ambassador, Sir Tim Barrow, is due to deliver it to EU's Donald Tusk around 12GMT. Tusk holds a press conference announcing that the negotiations will formally begin in the process of separating Britain from the European Union.

Meanwhile, USD/JPY is holding up in Tokyo after stops triggered a decent score on the 111 handle to 111.20 highs overnight with Wal Street on the march. Risk-on aided a recovery in the major unit that may slow down the crosses decline should bull's remain in control - hence GBP/JPY bears were last out of the blocks on this move in sterling just before the open.

Article 50 to be triggered: "So what now?" - Westpac

GBP/JPY levels

GBP/JPY is now posting the lowest levels since Jan 16 earlier this year is reversing 86% of January's rally from 136.44 to 144.72. The cross is well below the 2017 support line at 138.50. On a correction, the 20-d sma is located at 138.63 to place the cross back into neutral territory.

USDJPY: Selling rallies towards 111.70

Author

Ross J Burland

FXStreet

Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.

Markets move fast. We move first.

Orange Juice Newsletter brings you expert driven insights - not headlines. Every day on your inbox.

Editor's Picks

EUR/USD falls toward 1.1700 on broad USD recovery

EUR/USD turns south and declines toward 1.1700 on Wednesday. The US Dollar gathers recovery momentum and forces the pair to stay on the back foor, as traders look to USD short-covering ahead of US inflation report on Thursday. However, the downside could be capped by hawkish ECB expectations.

GBP/USD trades deep in red below 1.3350 after soft UK inflation data

GBP/USD stays under strong selling pressure midweek and trades below 1.3350. The UK annual headline and core CPI rose by 3.2% each, missing estimates of 3.5% and 3.4%, respectively, reaffirming dovish BoE expectations and smashing the Pound Sterling across the board ahead of Thurday's BoE policy announcements.

Gold clings to moderate daily gains above $4,300

Following Tuesday's volatile action, Gold regains its traction on Wednesday and trades in positive territory above $4,300. While the buildup in the USD recovery momentum caps XAU/USD's upside, the cautious market stance helps the pair hold its ground.