The British pound has initially pulled back slightly during the trading session on Wednesday but has found plenty of buyers underneath to turn around and show signs of life again. Ultimately, the 200 day EMA underneath now offer significant support, as the market is dancing around the ¥140 level. This is a large, round, psychologically significant figure that should continue to attract a lot of attention. Ultimately, this is a market that will find plenty of buyers based upon value more than anything else. Ultimately, this is also a market that has a huge a run up to this area.
GBP/JPY Video 07.11.19
Looking at this chart, if we can break above the top of the bullish flag, it’s very likely that the market goes looking towards the ¥150 level. The 50 day EMA underneath is reaching towards the crucial 200 day EMA, possibly causing a “golden cross” which of course is a very bullish sign for longer-term traders. The noise from Brexit continues to cause issues, so that’s probably the one thing that continues to put a little bit of a lid on this market. Once we do break out though, this market should continue to go much higher, skyrocketing once we finally break through resistance.
To the downside, the ¥137.50 level should offer a bit of support based upon the structural action that we had seen previously. Ultimately, this is a market that will eventually find a reason to go higher, but the question is whether or not the flag kicks off a or if we need to wait for value underneath?
Please let us know what you think in the comments below
This article was originally posted on FX Empire
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