US Treasury Intervention Sparks GBP/USD Rally
The GBP/USD currency pair has been exhibiting ranging behavior for over a year, making it a relatively stable currency pair. However, the US Dollar remains the primary driver of major currency pairs. Recently, the price of the USD/JPY and Yen crosses have fallen significantly due to the US Treasury's efforts to prop up the Japanese Yen.
The Bank of Japan has been trying to stabilize the Yen for months with little success, but the US Treasury's intervention has seemingly weakened the US Dollar. This development has created a path for other relatively firm currencies like the British Pound to rise against the US Dollar.
The price of cable has been rising since last Tuesday and exceeded $1.3500 in Monday's Tokyo session. However, sellers fought back, causing the price to move lower. The structure remains bullish, but with no short-term support levels breaking down recently.