GBP/JPY Price Forecast – British pound collapses against Japanese yen on Tuesday

The British pound has broken down during the trading session on Tuesday, as it was announced that the US was slapping more in the way of tariffs against the Chinese, which of course has a lot of a “risk off” feel to it, as people are concerned about the next move by the government. Ultimately, the Chinese will certainly retaliate, and people are starting to begin to wonder whether we are going to see a serious escalation. The ¥145 level is psychologically important as well as structurally and breaking down below there is of course a very negative turn of events.

By the time we have broken down below that level, it’s likely that rallies will be sold at this point, because quite frankly it’s difficult to imagine a scenario where people are going to be comfortable in this type of environment. I believe that it makes sense that the market would continue to go down to the ¥143.50 level, and by the look of the chart it could happen rather quickly. I would sell rallies until we were able to clear the massive resistance that has now built up over the last 24 hours. In other words, I would need to see a daily close well above the ¥145 level to be comfortable buying. I think at this point, we will continue to see a downward trajectory in this pair, as well as many other risk appetite based markets.

GBP/JPY  Video 20.06.18