Advertisement
Advertisement

GBP/JPY Weekly Price Forecast – British Pound Gets Hammered

By:
Christopher Lewis
Published: Jun 18, 2021, 14:47 UTC

British pound traders had a rough week as we initially tried to break above the ¥155 level but have collapsed two and half handle since then.

GBP/JPY

In this article:

The British pound initially tried to break above the ¥155 level during the course of the trading week, but then broke down rather significantly to reach down towards the ¥152.50 level. This is an area that should be thought of as a potential support level, but this type of candlestick typically gets a little bit of follow-through. While this is a very negative candlestick, you should keep in mind that it is not until we break down below the ¥150 level that this trend is truly broken, because it could be a huge “air pocket” underneath there due to the fact that we went straight up in the air to get to that level.

GBP/JPY Video 21.05.21

If that were to happen, one would think that it would be very negative for risk appetite around the world, which is something that we are seeing in general. With that being the case, I think that what we will probably look at is a potential pullback that tries to find buyers as we “reset” the entire situation. However, if we break down below the ¥150 level with any type of force, it is very likely that we will drop at least 500 pips, if not a thousand. To the upside, if we were to turn around and show signs of life it is likely that we would try to get back to the ¥155 level. All things been equal, I think the only thing that you can probably count on is a lot of volatility in this general vicinity, as the market reassesses the idea of a tightening Federal Reserve. This has sent ripples through the markets everywhere.

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.

Did you find this article useful?

Advertisement