GBP/JPY corrects from multi-month lows, back below 139.00 handle
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GBP/JPY corrects from multi-month lows, back below 139.00 handle

  • DUP rejects key parts of Brexit deal and exerts some fresh pressure.
  • The downside is likely to be limited ahead of the key EU Summit.

The GBP/JPY cross came under some pressure during the Asian session on Thursday and extended the previous session’s modest pullback from the 140.00 handle, or near five-month tops.
The British Pound witnessed a fresh wave of selling in the past hour or so in reaction to negative Brexit headlines, wherein the Northern Irish Democratic Unionist Party has expressed its discontent with several points in the Brexit deal that the UK and the EU are finalizing.

Brexit newsflow continues to influence

Given that the small party’s support is critical for the UK Prime Minister Boris Johnson to get the Brexit deal passed through the Parliament, the latest development forced investors to temper their expectations for a Brexit deal at the next EU Summit starting this Thursday.
The cross weakened back below the 139.00 round-figure mark, albeit the downside seems limited as investors might refrain from placing any aggressive bets ahead of the crucial European Council Summit, which will determine whether the UK will leave the EU with a deal on October 31 or not.

Technical levels to watch


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