GBP/JPY... What is going on??!!The Pound against the Yen has been short for roughly around the beginning of November and puts pressure for the yen over the new year.
From research, this pair may continue to go down, and here is why. Firstly, the Nikkei 225 has significantly dropped by 17.53% from the 2nd of October to the 28th of December. Reasoning behind this is due to other variables affecting the yen such as the US and China trade war which gives concerning to what Japan may have to face when they trade with the United States on new policies. Especially since Japan is the 4th largest trading partner with the United States, rallying up on $204.1 Billion in 2017.
Britain on the other hand is more focused on Brexit, for those who do not know, Britain is wanting to leave the EU for more tougher immigration laws in order to strengthen the safety of the citizens from terrorism. There are many other reasons but this is the main highlight of why. Some people in Britain do not agree with some of the new policies and laws that the government is trying to put in place, including trade. Confident votes have been used in the government but Theresa May (current prime minister) still has passed in the votes.
Overall, both countries are in the downside at the current moment and we will have to see what 2019 awaits for us all but this evidentially results in a short sell position for short and long term.
Happy New Year everyone!
