The British pound has dropped a bit against the Japanese yen again during the trading session on Wednesday as we have seen quite a bit of weakness over the last 48 hours or so. This is a market that I think continues to see a lot of noisy behavior, and of course will move based upon risk appetite as per usual. Furthermore, there has been a major disruption of power in the United Kingdom, so whether or not that ends up being a major factor on what happens next in the British pound remains to be seen.
GBP/JPY Video 16.09.21
This pair is highly sensitive to the overall risk appetite of markets, so pay attention to things like stock markets and commodity markets get an idea as to how much risk traders are willing to take on. The higher the risk, the higher this pair typically goes as the Japanese yen is considered to be a major “safety currency.”
All of that being said, if we turn around a break down below the bottom of the candlestick, then it opens up a move to reach towards the ¥150 level. That being said, markets in general have been very choppy as of late, although they have been trending in more of a “risk off” attitude recently, so pay close attention to short-term charts, and of course that massive resistance barrier near the ¥152.50 level. If we were to break down below the ¥150 level, then we start to challenge the 100 pips of support that extends down to the ¥149 level.
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