GBP/JPY Price Forecast – British pound breaks down on Tuesday

The British pound broke below a support level against the Japanese yen during early American trading on Tuesday, slicing through the ¥144 level. Because of this, it looks as if we are ready to go a bit lower, and as a result it’s likely that we will reach towards the ¥143 level. · FX Empire

Christopher Lewis

Updated Tue, Aug 7, 2018, 9:59 PM

The British pound has fallen rather stringently against the Japanese yen during the trading day on Tuesday, breaking below the psychologically and structurally important ¥144 level during early American trading. Because of this, the market looks as if it is ready to continue the downtrend, perhaps reaching towards the ¥143 level. That’s an area that has a certain amount of psychological significance to it as the round number will attract a lot of attention. Ultimately, I believe that the market will continue to see a lot of noise in this pair, which makes a lot of sense considering that we have so many moving pieces when it comes to the Sino-American trade spat that is going on.

Remember, this pair is very sensitive to risk appetite, and beyond that we also have the Brexit to worry about. If we do break back above the ¥144 level, then the market could go to the ¥145 level. That’s an area that is very important from a longer-term standpoint, so keep that in mind as a clearance of that level could be a very positive sign indeed. Ultimately, I believe that the market will probably continue to be very noisy and very difficult to deal with at times, because this pair is probably moving more upon headlines than anything else. A knee-jerk reaction is something that you will probably see continually in this pair. Overall, this is a market that will eventually find buyers, but I would be a bit leery of doing so right now.