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GBP/JPY continues to be hit by a double whammy

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GBP/JPY extends slide to a low of 143.50


A combo of a weaker pound and strengthening yen has been a real treat for sellers in the pair over the past week and the fall is continuing on the day. Softer sentiment from Brexit as negotiations between UK and the EU stalls as well as Theresa May’s own domestic political woes have been a real bane for the pound over the past two weeks. And then you add that to the recent worries in equities and risk sentiment, it’s fueling bids into the yen and it still is today.
The pair is now at the lows for the day now as the yen continues to strengthen across the board and price now threatens a break of the daily support from the 28 June low @ 143.78. The key level to watch out for though will be the 76.4 retracement level @ 143.39. That helped to provide support for the pair during a move lower back in late May.
But if you draw a Fib from the August low to the September high, there is support to be had as well from the 143.65 level. That will be another crucial area to watch out for on the daily chart. However, in essence, a close below the 144.00 level does not bode well for the pair as we have seen back in August. The break back then subsequently led to a further fall towards the 140.00 handle.
Right now it’s all about risk sentiment as that is the ultimate driver in yen pairs. But keep an eye on the technical levels as well to identify key support regions. Be safe out there. It’s a real killer of a time in markets now.

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