Trade view /
23 August 2016 at 14:13 GMT
The recent impulsive channel of GBPJPY has taken a look above the 132.00 level today, but feels extremely tired at these levels.
The time based technicals are favouring GBP in the short term, and yet this yields to selling of sterling against the yen as one moved to a weekly or monthly perspective.
Source: www.investing.com Spotlight Ideas
I am inclined to keep my selling stance that I adopted on August 15 as I still believe the yen will continue to feed off the general expectation that the Bank of England will look to reduce rates again in the UK. This comes at a time when the market is questioning how much more stimulus the Bank of Japan will be prepared to provide to the economy. Direct stimulus of JPY6 trillion was double the amount initially planned but would fall short of market expectations,
A break of 128.66 will resume larger down trend that has been the dominant force for this currency pair since July 2015 and target next projection level at 122.78.
GBPJPY 5-year chart:
Source: Spotlight Ideas
Management and risk:
Entry: Sell 132.00 14:00 GMT
Targets: 128.66 ... 122.78 ... 119.80 ... 116.83
Time horizon: Medium-term
— Edited by Clare MacCarthy
Non-independent investment research disclaimer applies. Read more