Chart in focus: GBPJPY
Brexit and Global trade woes to pressure GBPJPY
I was looking for intraday shorts yesterday on the GBPJPY pair as global risk sentiment soured and Labour's attempt to block a no deal Brexit was thwarted. However, there may be more of a move on the GBPJPY ahead, so a potential swing trade is looking good for anyone wanting to ride the dragon.
More Brexit woes ahead as Hard Brexit looms
The UK Labour opposition party vote on seizing control over Parliamentary business as a bid to block a no-deal was defeated by 309 vs 298 votes. Meanwhile, sonservative front runner Boris Johnson has privately reassured senior Brexiteers that he will leave option the open of suspending Parliament in order to force through a no-deal exit from the EU. To my mind the UK is moving at increasing speed towards a no-deal Brexit, with Johnson the man to deliver it.
As Boris launched his bid to be PM as the candidates introduced themselves he was on his very best behaviour. He kept to script, avoided any big gaffes, and was generally behaving well. The big concern for Boris's supporters is whether he can avoid making any obvious mistakes as he is currently the front runner. He did well. However, a word of caution. There is a history of favourites to win the Conservative party leadership being beaten by an outside runner. So, it is not a foregone conclusion that Boris will definitely win. However, whether it is Boris or anyone else, the EU is firmly entrenched in their view and further concessions are unlikely. Check out Adam's piece on what to watch out for in the UK leadership race.
Tariffs, tariffs and yet more tariffs from President Trump loom
On the US-China trade deal we have more souring of the relationship with China preparing for further blows from President Trump. The front running of inventories have cushioned the impact somewhat, but eventually those chicken will come home to roost and impact earnings. So, a GBPJPY short from key overhead resistance just under 140 looks good on the daily chart.
For a faster response, the 137.49 and pivot point level on the 4 hour chart looks good too. Stops above R1 and the 100EMA at the 139 region