New high incoming for GBPJPY?
“Kuroda stressed their commitment towards maintaining current stimulus.”
We witness yet another day of Japanese Yen’s weakness, with pairing of GBP/JPY hitting its highest level in 2 months. Yen was offered heavily in the market due to increasing divergence in between Federal Reserve and Bank of Japan policy guidance. Yesterday, BoJ Governor Haruhiko Kuroda emphasized that “it is not the time” to execute an exit strategy for current ultra-loose monetary setting. Likewise, Kuroda also added that the strategy will only be viable upon hitting inflation target of 2%.
Quick recap on GBPJPY
The pair extended its gains for two consecutive weeks following a rebound from 175.95.
GBPJPY Weekly Technical Analysis
MACD suggests possible extension on the upside in terms of weekly perspective.
GBPJPY Daily Technical Analysis
In daily perspective, GBPJPY is currently testing at the recent high of 167.48. This would be the currently level eyed by bulls who may take over the course for more upside ahead.
Trading Idea
ORDER: BUY STOP
ENTRY: 168.00
STOP LOSS: 166.20
Target 1: 170.00
Target 2: 170.75
ZFX Analyst’s Comment
The pair has further upside potential as both central banks diverge further from one another. With inflation pressure hovering at high level, portraying certain kind of “stickiness”, Fed may opt for more tightening if necessary.
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Risk Warning: The above content is for reference only, and does not represent ZFX’s position. ZFX does not assume any form of loss caused by any trading operations carried out in accordance with this article. Please be firm in your thinking and do the corresponding risk control.
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