- Investors looked past uninspiring Brexit developments over the weekend.
- Comments by DUP MP Shannon provided a goodish intraday lift on Monday.
- Risk-on mood dented the JPY’s safe-haven status and remained supportive.
The GBP/JPY cross maintained its bid tone through the mid-European session and is currently placed at the top end of its daily trading range, around the 141.00 handle.
The cross quickly reversed an early dip to the 139.50 region and turned higher for the fifth consecutive session on Monday – also marking its eighth day of a positive move in the previous nine – amid the ongoing Brexit drama.
Remains at the mercy of incoming Brexit headlines
Over the weekend, the UK lawmakers delayed a vote on the UK Prime Minister Boris Johnson’s Brexit deal and voted to ask for a Brexit-deadline delay, which exerted some downward on the British Pound earlier this Monday.
However, comments by DUP MP Jim Shannon, saying that they cannot support customs union amendment, helped shake off the latest concerns and limit any deeper losses, rather attracted some fresh buying at lower levels.
This coupled with the prevalent risk-on mood, as depicted by a goodish rally in equity markets, undermined the Japanese Yen’s perceived safe-haven status and provided an additional boost to the pair’s intraday uptick.
The cross was now seen consolidating strong intraday rally of around 185 pips as investors look forward to the House of Commons speaker – John Bercow’s decision to allow a meaningful vote on the Brexit deal.
Hence, it will be prudent to wait for a strong follow-through buying beyond last week’s swing high, around mid-149.00s, before traders start positioning for any further near-term appreciating move.
Technical levels to watch
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