GBP/JPY hammered down to fresh monthly lows, around 132.00 mark
- GBP/JPY remained under some heavy bearish pressure through the mid-European session.
- The pound was undermined by increasing prospects of an extended lockdown in the UK.
- Deteriorating global risk sentiment undermined the JPY and contributed to the downfall.
The GBP/JPY cross tumbled to near four-week lows in the last hour, with bears now looking to extend the steep decline further below the 132.00 round-figure mark.
The British pound remained under some intense selling pressure through the mid-European session and was seen as one of the key factors behind the pair's follow-through slide for the second straight session on Tuesday.
Tuesday's mixed UK employment details did little to impress bullish traders, instead prospect of an extended shutdown in the UK amid the ever-increasing number of coronavirus cases and related deaths took its toll on the sterling.
This coupled with deteriorating global risk sentiment provided a modest lift to the Japanese yen's perceived safe-haven status against its British counterpart and further contributed to the pair's heavily offered tone on Tuesday.
Against the backdrop of persistent worries over the economic fallout from the coronavirus pandemic, a slump in crude oil prices further weighed on investors' sentiment and the same was evident from a fresh leg down in the equity markets.
Meanwhile, Tuesday's steep decline could further be attributed to some technical selling below the previous monthly lows support near mid-132.00s. Hence, a subsequent slide back towards the 131.55 region, en-route sub-131.00 levels, now looks a distinct possibility.
Technical levels to watch