The British pound gapped lower to kick off the session on Monday, turned around to fill the gap, and then broke down from there. That being said, the market is likely to continue to go lower, perhaps reaching down towards the 50 day EMA as more fear about the coronavirus seems to be taking hold of the market. Infections are starting to spread throughout several other nations, the most notable one being South Korea. Because of this, equities around the world collapsed and there is more than likely going to be repercussions due to fear. The Japanese yen is of course a currency that suffers plenty of other issues right now due to the Brexit negotiations without this other nonsense.
GBP/JPY Video 25.02.20
Looking at this chart, it appears that the ¥145 level continues to be massive resistance, just as the ¥141 level underneath is massive support. All things being equal, I do favor the upside given enough time, but perhaps a day or two of calm will be needed first. At this point, I would anticipate a lot of volatility in noisy trading, but quite frankly it is in an uptrend so given enough time it should revert. Trading in this area is probably a bit difficult, although we may get a sudden move to the downside. If the market turned around and breaks above the ¥145 level, then it is very likely to go to the ¥148 level after that. The 50 day EMA is starting to slope higher from there, reaching towards the price action, but at this point it’s only a matter of time before we have to make a bigger decision.