“¢ Absent negative Brexit headlines prompt some short-covering around the GBP.
“¢ Fading safe-haven demand seen weighing on the JPY and remained supportive.
The GBP/JPY cross built on its steady intraday recovery from five-month lows and climbed further beyond the 137.00 handle to refresh session tops in the last hour.
In absence of any negative Brexit headlines, the British Pound witnessed some follow-through short-covering bounce on Tuesday and assisted the cross to gain some positive traction for the second consecutive session.
The Sterling was further supported by optimism over the UK-US trade relations especially after the US President Donald Trump’s comments, saying that we’ll have a very substantial trade deal with the UK.
The intraday uptick seemed unaffected by the disappointing release of UK construction PMI, rather took cues from improving risk sentiment, which tends to undermine the Japanese Yen’s relative safe-haven demand.
It, however, remains to be seen if the cross is able to capitalize on the recovery move or meets with some fresh supply at higher levels amid persistent UK political and Brexit uncertainties/fears of a no-deal split.
Technical levels to watch
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