GBP/JPY corrects from multi-month highs, back below 139.00 handle

DUP rejects key parts of Brexit deal and exerts some fresh pressure.
The downside is likely to be limited ahead of the key EU Summit.

Haresh Menghani FXStreet

The GBP/JPY cross came under some pressure during the Asian session on Thursday and extended the previous session's modest pullback from the 140.00 handle, or near five-month tops.

The British Pound witnessed a fresh wave of selling in the past hour or so in reaction to negative Brexit headlines, wherein the Northern Irish Democratic Unionist Party has expressed its discontent with several points in the Brexit deal that the UK and the EU are finalizing.

Brexit newsflow continues to influence

Given that the small party's support is critical for the UK Prime Minister Boris Johnson to get the Brexit deal passed through the Parliament, the latest development forced investors to temper their expectations for a Brexit deal at the next EU Summit starting this Thursday.

The cross weakened back below the 139.00 round-figure mark, albeit the downside seems limited as investors might refrain from placing any aggressive bets ahead of the crucial European Council Summit, which will determine whether the UK will leave the EU with a deal on October 31 or not.

Technical levels to watch

GBP/JPY

Overview
Today last price	138.8
Today Daily Change	-0.72
Today Daily Change %	-0.52
Today daily open	139.52

Trends
Daily SMA20	133.84
Daily SMA50	131.82
Daily SMA100	133.55
Daily SMA200	138.73

Levels
Previous Daily High	140.12
Previous Daily Low	137.48
Previous Weekly High	137.9
Previous Weekly Low	130.42
Previous Monthly High	135.75
Previous Monthly Low	126.67
Daily Fibonacci 38.2%	139.11
Daily Fibonacci 61.8%	138.49
Daily Pivot Point S1	137.96
Daily Pivot Point S2	136.4
Daily Pivot Point S3	135.32
Daily Pivot Point R1	140.6
Daily Pivot Point R2	141.68
Daily Pivot Point R3	143.24

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

EUR/USD holds firm above 1.1900 as US NFP looms

EUR/USD holds its upbeat momentum above 1.1900 in the European trading hours on Wednesday, helped by a broadly weaker US Dollar. Markets could turn cautious later in the day as the delayed US employment report for January will takes center stage.

GBP/USD remains above nine-day EMA near 1.3650

GBP/USD recovers its recent losses from the previous session, trading around 1.3680 during the European hours on Wednesday. The technical analysis of the daily chart indicates a sustained bullish bias, as the pair trades within an ascending channel pattern.

Gold sticks to gains near $5,050 as focus shifts to US NFP

Gold holds moderate gains near the $5,050 level in the European session on Wednesday, reversing a part of the previous day's modest losses amid dovish US Federal Reserve-inspired US Dollar weakness. This, in turn, is seen as a key factor acting as a tailwind for the non-yielding yellow metal ahead of the critical US NFP release.

US Nonfarm Payrolls expected to show modest job gains in January

The United States Bureau of Labor Statistics will release the delayed Nonfarm Payrolls data for January on Wednesday at 13:30 GMT. Investors expect NFP to rise by 70K following the 50K increase recorded in December.

S&P 500 at 7,000 is a valuation test, not a liquidity problem

The rebound from last week’s drawdown never quite shook the sense that it was being supported by borrowed conviction. The S&P 500 once again tested near the 7,000 level (6,986 as the high watermark) and failed, despite a macro backdrop that would normally be interpreted as supportive of risk.

BNB prolonged correction signals deeper bearish momentum

BNB (BNB), formerly known as Binance Coin, is trading below $618 on Wednesday, marking the sixth consecutive day of correction since the weekend. The bearish price action is further supported by rising short bets alongside negative funding rates in the derivatives market.