“¢ Renewed US-China trade tensions underpin JPY and prompt some aggressive selling.
“¢ The downside remains limited ahead of another round of UK cross-party Brexit talks.
The GBP/JPY cross remained heavily offered through the mid-European session on Monday, albeit has managed to recover around 20-25 pips from daily swing lows.
The cross struggled to capitalize on last week’s positive momentum and met with some aggressive selling at the start of a new trading week, erasing Friday’s goodish up-move to over two-week tops amid the global flight to safety.
The US President Donald Trump’s latest threat to impose tariffs on $200 billion worth of Chinese goods triggered a fresh wave of global risk aversion and provided a strong boost to the Japanese Yen’s relative safe-haven status.
The cross, however, managed to find some support/defend the key 145.00 psychological mark as investors refrained from placing aggressive bets and await fresh Brexit developments from the UK cross-party talks, starting Tuesday.
This coupled with the prelim UK GDP growth figures for the first quarter of 2019 – scheduled for release on Friday, will influence the near-term sentiment surrounding the British Pound and provide a fresh directional impetus.
In the meantime, broader market risk sentiment and incoming US-China trade-related headlines might contribute towards producing some short-term trading opportunities amid absent market moving economic releases.
Technical levels to watch
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