GBP/JPY Takes a Bullish Turn After BOE’s Inflation Report
Arslan Butt • 1 min read
The Japanese cross, GBP/JPY, takes a bullish turn after the release of the BOE inflation report. Bank of England’s Mark Carney says it’s more likely we would provide stimulus than tighten policy after no-deal Brexit.
Further from Mark Carney:
- The chances of a no-deal Brexit have increased, thus influencing the economy. Yet, the markets are not saying that no-deal is the most likely Brexit scenario.
- The level of uncertainty in business is as high as it was before the 29 March deadline.
- BOE forecasts will change if the UK moves towards a no-deal Brexit.
- Just like old times, the BOE Governor Mark Carney decided to stay on the sidelines until there is more clarity regarding Brexit.
The no-Brexit sentiment was already priced in, and investors considered to react to the facts. As a result, we have a massive buying in the GBP/JPY.
Technically, the pair faced reliable support around 135.800, as the Guppy was forming bullish reversal candles on the 3-hour chart. Whereas, the BOE inflation report also triggered Sterling demand, causing a bullish breakout at 136.400 resistance area.
It was that point when we decided to jump in the market to target 136.82. By the time I’m covering this setup, the market has already closed our trade at take profit.
Don’t worry; we have another trade plan. GBP/JPY is likely to face resistance below 137.100 double top level. Closing of 2-hour candle below this level can trigger a sell-off in GBP/JPY, and here you can capture another quick 30 pips.
Good luck and trade with care!