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Christopher Lewis
GBP/JPY daily chart, June 17, 2019

The British pound fell against the Japanese yen again on Friday, as we continue to see a lot of interest at the ¥138 level. The market of course is highly sensitive to risk appetite and it seems like we are all over the place. Beyond that, the British pound has to deal with the Brexit and all of the nonsense headlines that come out of there, so be aware that we could get a sudden change of attitude.

GBP/JPY  Video 17.06.19

If we break down below the ¥136.50 level, then it’s likely that we could go down to the ¥135 level. That’s an area that should attract a lot of attention, and if we can break down below there we probably even unwind down to the ¥131 level. Alternately, if we turn around and break above the ¥138 level, then we can go to the ¥140 level. This will probably be all due to risk appetite around the world, and in other markets in general. With this, pay attention to what goes on with the stock markets as it could give us an idea as to where this pair goes next.

Unlike the GBP/USD pair, this features a true safety currency. The US dollar is somewhat of a safety currency but we also have the Federal Reserve stepping away from what people thought was a relatively tight monetary policy. If that’s going to be the case, it’s likely that the US dollar is overvalued, and therefore the GBP/USD pair can move counter to what goes on over here.

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