A short GBP/JPY trade recommendation


The arguments you may seen cited in favour of short GBP/JPY in summary:

  • bias favouring yen strength
  • speculation on negative rates in the UK 

With the risk is the on the popularity of the short GBP trade, a crowded position.

SG weigh in on the trade:

  • improvement in risk sentiment overall and renewed collapse in volatility – gives a bullish yen bias
  • Bank of England has a massive task ahead – retail sales bad, public sector finances are worse than expected … talk around negative rates piles pressure on GBP

SG trade idea on the pair (this from Friday):

  • Shorting GBP/JPY at 130.70
  • 136 stop
  • 120 target
short GBP/JPY chart

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