GBP/JPY drops to 3-week lows near 144.00

The cross losses further momentum and tests the 144.00 area.
Uncertainty around Brexit keeps weighing on the British Pound.
Some risk-off mood lends fresh oxygen to the Japanese Yen.

Pablo Piovano FXStreet

The pick up in the demand for the Japanese safe haven has been weighing on GBP/JPY in past sessions, dragging to test fresh 3-week lows in the vicinity of the 144.00 handle during early trade.

GBP/JPY looks to Brexit, risk-trend

The sharp decline in yields of the key US 10-year note are fuelling the demand for the Japanese safe haven currency, in turn lending extra sustain to the ongoing leg lower in the cross.

In addition, the lack of progress in the UK-EU negotiations on Brexit has been also collaborating with the selling mood surrounding the Sterling and therefore adding to the multi-week retracement in the cross.

Nothing worth mentioning from today’s BoE event, where Governor M.Carney noted that a ‘no-deal’ scenario would be very unusual. Still in the UK, PM Theresa may is expected to meet EU J.C.Juncker tomorrow in Brussels to discuss trade.

GBP/JPY key levels

As the moment the cross is losing 0.16% at 144.49 facing the next support at 144.07 (low Nov.20) seconded by 143.76 (low Jun.28) and finally 143.21 (2018 low May 29). On the other hand, a break above 146.00 (21-day SMA) would expose 147.15 (200-day SMA) and then 149.49 (monthly high Nov.8).

Author

Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

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