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GBP/JPY Price Forecast – The British Pound Pulls Back From ¥165

By:
Christopher Lewis
Published: Jul 5, 2022, 14:05 UTC

The British pound initially tried to rally during the session on Tuesday but then got crushed as risk appetite got hammered around the world.

Japanese Yen FX Empire

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British Pound vs Japanese Yen Technical Analysis

The British pound initially tried to rally during the trading session on Tuesday but gave back a bit of gain rather quickly at the ¥165 level. The ¥165 level is an area that’s been noisy for a while, and the massive reversal that we have seen during the trading session shows just how much trouble there is out there for risk appetite assets. Breaking through the ¥162.50 level is negative, but I would also point out that there is a “squishy area of support” in this general vicinity, that extends down to the ¥160 level. The ¥160 level is much more important to me, because I think at that point you can start to talk about the trend breaking apart.

On the upside, if we could turn around a break above the ¥165 level, then it’s likely that we will go back toward the high again. That being said, there seems to be a lot of fear and volatility out there, so regardless of which direction you are placing a trade in, the most important thing you can do is keep your position size reasonable. You could lose a lot of money rather quickly in this type of environment, so I would not go “all in” on a trade.

The fact that we turn around so violently does suggest to me that we probably have more negativity ahead of us. The ¥160 level will be crucial, especially if the 200 Day EMA can get there while Price does. I don’t know that it will beat price to that level, but it gives you an idea of just how important that pullback could end up being for the longer term.

GBP/JPY Price Forecast Video 06.07.22

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

About the Author

Being FXEmpire’s analyst since the early days of the website, Chris has over 20 years of experience across various markets and assets – currencies, indices, and commodities. He is a proprietary trader as well trading institutional accounts.

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