GBP/JPY falls 0.30% as Asian stocks drop on virus concerns
- GBP/JPY drops to 134.75, having faced rejection near 136.00 on Thursday.
- Coronavirus concerns and stock market losses push the anti-risk yen higher.
GBP/JPY fell 0.30% during Friday's Asian trading hours to 134.75, extending the pullback from Thursday's high of 135.92, as losses in the Asian equity markets strengthened the bid tone around the anti-risk Japanese yen.
Asian stocks declined with the Shanghai Composite losing 1% of its value as record deaths in Florida and California put the focus on the resurgence of the coronavirus in the US and across the world and squashed optimism fueled by the gradual reopening of economies.
Additional uncertainty stemmed from the US Supreme Court's ruling that President Trump cannot hide his tax information and the US decision to impose sanctions on Chinese officials allegedly involved in human rights violations in the Muslim-dominated Uighur province.
From a technical analysis standpoint, the pair's drop to 134.75 put the bears back into the driver's seat. The losses validated the inverted bearish hammer candle created on Thursday, marking an end of the corrective rally from lows near 131.75 seen on June 22.
The bias would turn bullish if the pair finds acceptance above 135.92, although that may remain elusive as long as markets remain risk-averse.
Technical levels