British Pound Plunges Against Yen to Find Buyers

The British pound has fallen rather hard during the trading session on Monday to reach towards the ¥151 level before bouncing a bit. Ultimately, this is a market that has been oversold due to the massive move on Friday, but it is probably only a matter of time before the bounce gets sold into due to all of the concerns around the world. Geopolitical problems aside, we also have to worry about a severe lack of growth.

GBP/JPY Video 08.03.22

Remember, this pair is highly sensitive to risk appetite, and therefore I think what we have is a scenario where we will probably continue to see a lot of noisy behavior and selling pressure given enough time. The market could go as low as ¥150, but that does not necessarily have to happen overnight. That is an area where I would expect to see a massive amount of support, as it is the bottom of the larger consolidation area going back multiple months.

The 200 day EMA currently sits just above the ¥152.50 level, an area that matters in and of itself as well. This would be an area where I would anticipate seeing a little bit of trouble, so if we did break above there then we could go looking towards the ¥154 level where the 50 day EMA is crashing towards and is the top of the massive candlestick from Friday. That being said, we would need to see a lot of good news for that to happen so I am not necessarily holding my breath for that possibility.

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