British Pound Melts Down Against Japanese Yen

The British pound has melted down against the Japanese yen during the trading session on Thursday as Russia has attacked Ukraine. This obviously has caused quite a bit of fear in the market, and therefore it makes sense that we would see plenty of selling pressure when it comes to risk appetite. Ultimately, this is a market that I think will continue to be very difficult to deal with but at the end of the day it is likely to see more selling than buying. Because of this, I like the idea of fading rallies as they occur and jumping on them at the first sign of exhaustion. This will be especially true if things actually escalate in Ukraine, something that seems very possible.

GBP/JPY Video 25.02.22

Adding more tension is the fact that China has just made a statement about how “Taiwan is not Ukraine.” And reiterated their opinion and statement that it is a part of China itself. In other words, things are unraveling quite quickly with the world’s authoritarian regimes.

At this point, it looks very likely that we will see an attempt to reach down towards the 200 day EMA, an area that of course attracts a lot of technical attention. Because of this, I would anticipate some type of big bounce near that area, because it is such an important part of most technical traders you point. I have zero interest in trying to get long of this market right now, at least not until Russia stepped out of the Ukraine area. That does not look likely, so therefore I think we have far too many things working against us to believe that we are suddenly going to turn around.

For a look at all of today’s economic events, check out our economic calendar.