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GBP/JPY – Gunning for April Highs?
With GBP/USD hovering near 4 year highs and USD/JPY quietly inching upwards, GBP/JPY rose to its strongest level in 2 weeks. The currency pair is in play with the Bank of England minutes and UK retail sales scheduled for release this week. While there’s greater downside than upside risk from sterling, the real risk doesn’t come until retail sales on Friday because the central bank minutes aren’t expected to show any significant changes in the central bank’s outlook. So instead, the market’s appetite for dollars will play a bigger role in how GBPJPY trades in the front of the week. USD/JPY is closing in on 103 and if this level is broken, GBP/JPY could find itself testing its April highs.
Higher highs and higher lows in GBP/JPY point to further upside potential. Now that the currency pair has cleared 172, there is no major resistance until the April high of 173.16. If GBP/JPY starts to slip and drops below 171.45, losses could extend down to 171.00.