The British pound rallied significantly during the course of the trading session on Thursday as we continue to look towards higher pricing. Ultimately, this is a market that I think continues to see a lot of interest to the upside as this is a “risk on/risk off” type of scenario. Ultimately, short-term pullback should continue to be bought into, with a floor down at the ¥140 level.” Ultimately, this is a market that looks likely to go looking towards the ¥145 level on the breakout, but it is going to take a lot of work to make that happen.
GBP/JPY Video 22.01.21
The 50 day EMA is starting to reach the ¥140 level as well, and as a result I believe that will become the “floor the market” going forward. Short-term pullback should be thought of as a buying opportunity and value the people will take advantage of, so therefore I like the idea of taking advantage of “cheap British pounds.” The Japanese yen is getting sold off in general, with the exception of against the US dollar as the US dollar might be the only currency that is weaker than the Japanese yen overall.
As far as selling is concerned, I do not necessarily have any interest in trying to do so, so ultimately this is a market that will continue to go towards higher levels as people continue to bank on the idea of stimulus going forward, and therefore I think it makes quite a bit of sense that this is a “buy on the dips” type of situation going forward.
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This article was originally posted on FX Empire