Yahoo Finance GBP/JPY continues breakout on Monday
The British pound has rallied a bit during the trading session on Monday, breaking above the previous uptrend line that had been so important in the overall trend previously. Now that we have broken back over that line, I suspect that this market will continue to look towards higher levels, such as the 153 handle. The market is highly sensitive to risk appetite and noise, and of course the overall reactions to headlines coming out of the negotiations between the United States and China.
I believe that over the longer term, the speculators will come in and pushes market higher, but it is also going to be susceptible to be the occasional pullback and of course headlines that spooks the market. Pay attention to the S&P 500 as well, as it is a good barometer on risk appetite globally, and if it rises, typically the Japanese yen sells off. This is especially true against the British pound as it is anticipated that the Bank of England will start raising interest rates relatively soon. The British pound itself has been undervalued for some time, and I continue to like buying Sterling on dips. The Japanese yen of course is sold off in times of comfort and aggressive buying of assets overall, so keep that in mind. I believe that the 150-level underneath is now going to act as the “floor” in the market. If we were to break down below that level, that would be very negative for this market and send it much lower.
GBP/JPY Video 10.04.18
This article was originally posted on FX Empire
