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Pound pairs broke higher on YouGov poll results released earlier in the day, so this bullish momentum could carry on for the rest of the session.

Currency Snapshot:

Forex Major Pairs Performance from MarketMilk
Forex Major Pairs Performance from MarketMilk

Fresh Market Headlines & Economic Data:

Upcoming Potential Catalysts on the Forex Calendar:

  • Swiss Q3 GDP at 6:45 am GMT
  • German preliminary CPI m/m coming up
  • Spanish flash CPI y/y at 8:00 am GMT
  • Canadian current account balance at 1:30 pm GMT

What to Watch: GBP/JPY

Sterling staged quite the rally earlier on when the YouGov MRP poll results confirmed that Tories could end up with a sizeable lead in the December 12 general elections, providing enough support for PM Johnson’s Brexit plans.

On the flip side, the yen has been on weaker footing due to downbeat Japanese retail sales data also printed in the previous session. BOJ Governor Kuroda mentioned that a mix of monetary and fiscal policies are necessary to keep the economy afloat but also noted that the government’s hands are tied when it comes to boosting spending.

GBP/JPY 4-hour Forex Chart
GBP/JPY 4-hour Forex Chart

Guppy broke above its short-term range between 139.50 to around 141.00 to indicate that bulls have won the tussle. A rally of the same height as the rectangle could follow from here.

Moving averages reveal that the pair is on a strong bullish run:

GBP/JPY Trend Strength from MarketMilk
GBP/JPY Trend Strength from MarketMilk

However, stochastic is reflecting overbought conditions and a return in selling pressure, possibly allowing the pair to retreat to the broken range resistance around 140.75 to 141.00 to gather more bullish energy.