The British pound has shown itself to be rather resilient as it initially fell against the Japanese yen early Wednesday morning to test the ¥140 level again. This is a large, round, psychologically significant figure of course, and will attract a lot of attention. By doing so, it looks as if the market is ready to try to reach the top of the overall consolidation, and possibly even breakout. Certainly, the momentum is to the upside and it is probably only a matter of time before the market breaks out, and if you want any type of confirmation, simply look at the USD/JPY pair as it looks very similar. While most of this is probably due to the British election, don’t forget there is a Japanese yen part to this as well.
GBP/JPY Video 28.11.19
With all of that being said we have been consolidating for some time, and eventually markets will break out. Once they do, we could get an explosive move to the upside, especially if the UK elections look like there’s going to be a Tory majority in the Parliament, giving Boris Johnson the ability to get out of the European Union finally. At this point, the result of Brexit really isn’t as important as the idea of finally getting some type of resolution. This is a market that will be extraordinarily volatile and explosive once it makes up its mind so keep that in mind. I like buying dips, I love buying breakouts, and have no interest whatsoever in shorting this market at this current time.
Please let us know what you think in the comments below
This article was originally posted on FX Empire
More From FXEMPIRE:
- Natural Gas Price Prediction – Prices Cannot Gain Traction as Inventories Decline Less than Expected
- EUR/USD Price Forecast – Euro Continues To Fall
- Gold Price Forecast – Gold Markets Pullback To Find Buyers
- AUD/USD Price Forecast – Australian Dollar Continues To Try And Find Bottom
- GBP/USD Price Forecast – British Pound Continues Consolidation Pattern
- GBP/JPY Price Forecast – British Pound Rallies Against Japanese Yen