GBP/JPY Price Forecast – British Pound Falls Hard Against Japanese Yen

The British pound initially tried to rally against the Japanese yen on Tuesday but gave back the gains to crash into the ¥132 level. By breaking through the ¥132.50 level, the market has shown that it is ready to go much lower. I believe that it’s only a matter of time before this pair gets down to the ¥130 level, but we may get the occasional pullback on the way down. I don’t necessarily think that we are going to plummet lower, but clearly that is the path of least resistance at the moment. If we break down below the ¥130 level, it then will go looking towards the ¥127.50 level.

GBP/JPY Video 22.04.20

Keep in mind that this is a risk sensitive pair, so therefore it will move back and forth due to overall market conditions. At this point, the candlestick certainly looks very ominous, so that does suggest there is further downside coming. Rallies of course can and will happen but those should be sold into unless something drastically changes with the macro economic outlook, which quite frankly I don’t see how that would happen. Ultimately, I believe that it’s only a matter of time before some type of “other shoe drops” in order to send this pair lower, but whether or not we test the lows again might be a completely different question. If we were to rally from here, I suspect that the ¥135 level should be a massive ceiling in this market, and I would be surprised to see this market break above there anytime soon.