The British pound gapped slightly higher against the Japanese yen to kick off the day in Asia, but with multiple countries around the world, including the United States and the United Kingdom, having holidays, the markets did truly little. That being said, we can look at this market and see that the ¥132 level is an area that has offered significant resistance and has offered significant support previously. Because of this, it is likely that the market is going to continue to respect that is the top of the range, and I will be looking to sell this pair if we get anywhere near there. If we break down below the ¥131 level significantly, then it opens up a move down to the ¥130 level, followed very quickly by the ¥129 level.
GBP/JPY Video 26.05.20
Keep in mind that this pair is extremely sensitive to risk appetite, which of course is all over the place right now. But when you look at the longer-term chart, it is obvious that we are clearly drafting lower over time, even though we are at historically low levels. Quite frankly, the United Kingdom has an absolute mess on its hands when it comes to the economy and the Brexit, so there are a lot of moving pieces that could come in and work against the value of the British pound itself. Beyond that, we could also be looking at headlines crossing the wires from a global sense that causes a lot of issues as well. If that is going to be the case, then it makes sense that the Japanese yen would be bought.
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This article was originally posted on FX Empire
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