The BoE possibility to raising interest rates jumped to 90%, the best trade - GBP/JPY Long

The Governor of the Bank of England is ready to raise rates due to Britain's economic weakness. Inflation in the country is at a four-year high, and the central bank is preparing to proceed to the first interest rate increase in ten years. Carney will rely on the fact that confidence in the economy is weakening, island earnings have the lowest growth rates, and the uncertainty surrounding Brexit is increasing every day. BOE believes that inflation will remain at high levels and this allows for an increase in interest rates during a downturn in the economy.

Currently, the interest rate pick-up is 90% on November 2nd, and this has a positive effect on the GBP.

The best trading option is GBP/JPY, where the price has managed to break the upper limit of the mid-range range and return to test breakthroughs. The price generates a Price Action signal on two reversing bars on Monday at horizontal and diagonal support levels matched by 38.2% Fibonacci correction and 50SMA. Given the strength of GBP and the decline in JPY, we can position ourselves with long positions now and SL at around 145.70.

Source: Bloomberg Pro Terminal

Jr Trader Petar Milanov

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