The British pound has rallied during the week, breaking above the ¥135 level but pulled back from there rather significantly as you can see by that wick on the chart. That being said, we have turned right back around to threaten ¥135 yet again, so this tells me that the market is very resilient and is looking to go further to the upside. The 50 week EMA is above and that probably will be a little bit of technical resistance but if we can break above the top of the weekly candlestick, I anticipate that we go looking towards the ¥140 level next. Keep in mind that this pair is somewhat risk sensitive, so if we can get good news coming out of the stock market or something like that, then this could rally.
GBP/JPY Video 13.07.20
The British pound in general has been extraordinarily strong lately, so it should not be a huge surprise to see that this market is climbing. However, it should also not be a big surprise to see this market turn around and roll over quite drastically if we get negative headlines coming from the coronavirus or something just as important. The world is full of potential dangers at the moment, so you need to be cautious about putting too much money into a “risk on” type of trade like buying this pair, but clearly the market has more momentum to the upside than down recently, and at the end of the day “price is truth.” Currently, it looks as if price is telling us to be bullish.
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This article was originally posted on FX Empire
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