- The week ahead looks cloudy for the GBP as Brexit headlines continue to disappoint.
- A thin Asia market session sees the Guppy kick Monday off with UK data.
The GBP/JPY is still stuck in a cyclical rut near 148.35 after last week saw the pair stick to its bullish slant from a low of 146.95, but failed to generate new highs into the 150.00 major handle as Brexit negativity continues to drag down the Sterling.
Brexit is beginning to resemble a ball and chain on the Pound, with all sides of the current negotiations unsure of how to reach or even define what they want to see happen, and Prime Minister Theresa May continues to drive her latest Chequers proposal into the grave, with the European Union looking unmoved on talks surrounding the proposal, and Europsceptic UK ministers back home equally likely to torpedo the Chequers proposal even if it gets approved by the EU, and bullish Pound hopefuls are stuck waiting for new signs of hope that a clean Brexit can still happen.
It’s going to be a quiet week for the JPY, with little notable data on the economic calendar for the Japanese side of the equation. Japan’s third-quarter Tankan All-Industry Capex dropped for Monday at 13.4%, a tick lower than the previous reading of 13.6% and missing the forecast 14.2%.
The UK’s Mortgage Approvals and Markit Manufacturing PMI await Sterling traders at 08:30 GMT, and Mortage Approvals for August is expected to come in at 65.121 thousand (last 64.768 thousand), while September’s Markit PMI is expected to also improve, forecast at 53.8 (last 52.8).
GBP/JPY levels to watch
The Guppy’s two-week high rests nearby at 149.70, still trapped by the massive 150.00 technical handle, and the 200-hour EMA sits nearby at 148.20, with the only nearby support at last week’s swing low of 146.95.
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