The pound jumped following a report that mentioned an offer from the European Union to the United Kingdom on a two-year transition period. Before that, GBP was the worst performer in the market and in a few minutes erased all losses.
GBP/JPY bottomed earlier at 147.26, the lowest since Monday, after Michel Barnier, EU's chief Brexit negotiator said that talks regarding the “divorce bill” reached a “deadlock”. The pair then bounced modesty to the upside and during the last hour gained more than a hundred pips, on the report about the EU offer. It even reached a fresh weekly high at 149.08.
The pair so far is being unable to consolidate ton top of 149.00 but the intraday tone has changed dramatically, again, now favoring the upside. Volatility remains elevated on Pound’s crosses amid Brexit talks. With a round of negotiations on its ways, the currency is likely to be exposed to comments from officials, rumors, and speculations.
Levels to watch
To the upside, resistance levels might be located at 149.00/10 (Oct 12 high / Oct 4 low), 149.45 (Oct 5 high), 149.95 (Oct 4 high / Sep 26 low). On the flip side, support could be seen at 147.80 (Oct 11 low), followed by 147.25 (daily low) and 146.90 (Oct 9 low).
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