June 3rd 2021
The pound has recovered much of its mid week wobble, as the market thinks that the June 21st grand re-opening of the UK economy was nothing but a symbolic gesture. As much of the UK is already open.
The UK Government scientists still want another month of closure to see off pandemic wave 3, but I think PM Boris Johnson will not submit to the science, this time.
Even if Johnson has a change of heart, he won’t impose a lockdown with the UK’s vaccine rollout proving a success in keeping people out of hospital. The economic effect of a soft opening is not going to derail the UK’s rebound. So any resulting GBP dip will be met with buyers.
Resistance is being tested at 1.4200 today and if broken the market will be looking for another attempt at the highs of 1.4240/50, however sustainable breakouts for the short term at least, will be determined by the strength of US data releases today, and of course tomorrows NFP.
Immediate Support will be found at 1.4160 and if broken more buyers will be found first at 1.4130 and 1.4100.
The GBPJPY looks to have completed its correction from the recent highs around 156.00. Having traded down to 154.90 yesterday, the price has now recovered to break back above 155.50 and looks to have 155.90/156.00 in it sights again.
A break of 156.00 would open up a test of 156.60/80.
Day trader dip buyers will be found at 155.40/30 with stronger support first at 154.90 then 154.30
If the pound can keep above the key pivotal area of 1.2720/40 then there is a chance we see 1.2790/1.2800 But above here has been a tough nut to crack.
However, any weakness and we drop below 1.2720, I think then we are back to the bottom of the recent range at 1.2680 or even 1.2660.
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