GBP / JPY climbs to highs in almost a month, closer to 153.50

• A combination of factors pushed the GBP / JPY, which is up for the third day in a row.
• Lower fears for Omicron turned out to be a key factor behind the performance of the British pound.
• Optimism also pushed the yen down.

The GBP / JPY continued to climb on Thursday in the European session and spiked to a nearly a month high, around the 153.45 region in the last hour. A combination of factors helped the cross take advantage of this week’s solid bounce from the 149.50 area and was up for the third day in a row on Thursday. The strong performance of the British pound comes amid reduced concerns about the Omicron impact, which continues to advance rapidly.

Reports indicated that current vaccines may be more effective than previously thought in fighting the new COVID-19 variant. Additionally, a South African study suggested lower risks of hospitalization and serious illness in people infected with Omicron compared to the delta strain. This helped offset concerns about rising COVID-19 cases in the United Kingdom.

In fact, Britain reported 106,122 new cases on Wednesday, the highest level since the start of the pandemic. UK Prime Minister Boris Johnson ruled out the possibility of imposing further restrictions before Christmas. Johnson added that data related to the Omicron variant will be kept under review to see if stricter measures are needed next week.

However, GBP / JPY has been gaining strong positive traction, further supported by good mood in stocks, which tends to weaken the Japanese yen. This, along with some technical buying after a sustained advance over the 200-day SMA.

In the absence of relevant economic data to move the UK market, the events surrounding the saga of the coronavirus they will play a key role in influencing the GBP. Regarding the yen, market sentiment and what happens to Treasury yields will be critical.

Technical levels