This pair is of course too sensitive to risk appetite and it is worth paying attention to how the rest of the world is doing. At this point, the market sees some resistance in the area of the ¥ 132 level, so it makes sense that we are blocking here. As we head for the weekend, don’t be surprised at all to see the market drift a little lower, but overall it’s a market that has been collapsing for quite some time, so I’m a seller of this pair until we can break above the ¥ 133 level.
GBP / JPY Video 11.05.20
On the downside, it makes sense that we can go down to the ¥ 130 level, as this is a large, round and psychologically significant figure and an area that will likely garner some support. If we can break it down below, it is likely that the market is heading towards the ¥ 125 level in the longer term. Remember that this would go perfectly with the idea of a “risk-free” scenario. The collapse of rallies will continue to be my way of playing in this market, but I also expect a lot of noise as the market is clearly focused on global growth, or even the lack of global growth. In the end, I have no interest in buying this pair anytime soon, even if we exceed the level of ¥ 133. The markets have been very quick to react to bad news at times, and so it makes sense that this pair continues to struggle.