The British pound rallied a bit during the trading session on Wednesday, reaching towards the ¥130 level, an area that is massive in its importance due to the fact that it is a large, round, psychologically significant figure. Beyond that, we have a significant amount of built-in resistance there due to recent trading. Ultimately, I think that the market will probably roll over, but if we do get some type of relief rally there is the 50 day EMA just above that could cause quite a bit of resistance. At this point, the market would probably find technical sellers.
GBP/JPY Video 05.09.19
After that, the ¥132.50 level will also bring in quite a bit of resistance, and there is a lot of order flow in that area. With that, I would be willing to sell it either level that show signs of exhaustion even if we do get potential break out between now and then. After all, it’s only a matter time before some type of negative headline comes out of the United Kingdom involving the Brexit situation. If there’s one thing that we been able to count on over the last three years it’s bad news coming out of Great Britain.
Beyond all of that, this is a risk sensitive pair and it’s likely that we will continue to see a lot of concerns around the world when it comes to the idea of global growth, the US/China trade relations, and plenty of geopolitical situations. Ultimately, this is a market that will continue to be very volatile, but I believe that we still have further to go.
Please let us know what you think in the comments below
This article was originally posted on FX Empire
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