GBP/JPY touches multi-year low

June 14, 2016

GBP/JPY dropped to touch a new multi-year low below 150.00 on Monday, hitting a level not seen since August of 2013. As might have been expected in the run-up to next week’s EU referendum in the UK, this drop has been largely fueled by unease over the near-future prospects of the British pound if a Brexit vote (a UK decision to leave the European Union) prevails. Further driving the pressure on GBP/JPY has been a general boost for the safe haven Japanese yen, partly also due to market jitters ahead of the upcoming referendum.

The very latest UK polls with respect to Brexit have shown the Leave camp ahead by a wider margin than previous polls have shown. Friday’s poll from The Independent saw a ten-point lead for those who favor leaving the EU, while Monday’s poll from The Guardian showed a slightly lower six-point lead, also for the Leave camp.

As noted, this heightened Brexit risk has placed increasing pressure on sterling recently while helping to boost traditional safe haven assets like gold and the Japanese yen. This combination of a weakened pound and surging yen has accelerated GBP/JPY’s fall towards and below the key 150.00 psychological level. This drop extends the currency pair’s long-term downtrend that has been in place for the past year.

While the directional bias for GBP/JPY in the aftermath of next week’s EU referendum will be largely dependent on the actual outcome of the vote, the currency pair could continue to fall in the run-up to the referendum as volatility and uncertainty continue to weigh heavily on the markets. In the event of further trading below 150.00, the next major downside targets are at the 147.50 and then 145.00 support levels.

Publication source information reviews

October 25, 2016
Fed speech, flash PMI push dollar to a fresh 8-month high
Marking the final day of Fed speeches ahead of the one-week blackout period starting today, FOMC voting member, Bullard said that December was most likely for a rate hike...
October 25, 2016
M&A activities drove equities, focus shifts to earnings
Equity markets began the week on a positive note with M&A activities, positive earnings, and better than expected manufacturing data from the Eurozone and U.S. all boosting appetite to risk...
October 24, 2016
Dollar at a 3-week winning streak
The US dollar completed three weeks of back to back gains with the US dollar index seen trading above the 98.55 handle. Without any pullback so far, further upside could come at a significant risk...

Orbex Rating
FBS Rating
XM Rating
Fort Financial Services Rating
FXCM Rating Rating

Porter Finance Rating
Beeoptions Rating
Binary Brokerz Rating
TropicalTrade Rating
Grand Option Rating
365BinaryOption Rating