GBP/JPY: Expectations of orderly Brexit weighs on political noise

• Major support for the Brexit deadline extension supersedes uncertainty surrounding PM May’s political command and/or her third proposal for a vote.
• Irish backstop keeps playing its role to restrict the Brexit proposal acceptance.

The British Pound (GBP) is taking bids around 148.20 versus the Japanese Yen (JPY) during early Monday. The GBP/JPY pair is under pressure due to recent headlines from the UK politics challenging Theresa May but has managed to remain up on expectations of an orderly British exit from the EU.

Ever since the UK members of parliament (MPs) voted to extend the Article 50 deadline from March 29 on Thursday, speculations surrounding an orderly Brexit have gained momentum. The British PM Theresa May said she could request the EU to allow for three months of extension if her re-revised Brexit proposal gains parliament support.

While the majority of lawmakers were favoring the developments, a bunch of them were preparing to oust PM May from her seat. In doing so, some 40 MPs propose May to offer her resignation by April in exchange for their support for the third Brexit proposal.  

Additionally, the UK Telegraph also came up with a report that ex-foreign minister Boris Johnson urged Eurosceptic MPs to reject Theresa May’s Brexit deal for a third time if it is put to the vote this week as he warns it gives the EU “an indefinite means of blackmail” against the UK. BBC also ran a story mentioning that the UK’s Chancellor says Theresa May’s third Brexit proposal won’t be up for a vote unless she has support from the Irish political frontier Democratic Unionist Party (DUP).

Next up in investors’ radar will be developments surrounding whether the British PM can manage to opt for voting on her third Brexit proposal on Tuesday or British lawmakers plot to topple her from the PM seat.

GBP/JPY Technical Analysis

In spite of repeated failures to surpass a downward sloping trend-line joining September high to November high, at 149.00 now, the quote remains well beyond 146.70 and 200-day simple moving average (SMA) figure of 144.75.

Given the pair’s ability to conquer 149.00, 150.00 and 150.70//75 could lure the buyers.