The British pound fell a bit against the Japanese yen as we continue to see a lot of concerns about the Brexit and of course risk appetite in general as the world is on edge for several different reasons. After all, bonds are through the roof, which also is a way to avoid risk. The Japanese yen is considered to be a “safety currency”, so therefore it’s likely that we will continue to see a lot of interest when it comes to shorting this market. In a sense, the market is a perfect scenario for the times that we are in right now, because we not only have negativity when it comes to risk appetite, but we also have the British pound suffering through the Brexit.
GBP/JPY Video 15.08.19
I don’t see how this market would rallying until we got some type of clarity with the Brexit, something that seems to be far from reality at this point. Longer-term, I believe that the market will continue to go lower, perhaps reaching towards the 125 handle given enough time. Longer-term, this should be a great buying opportunity but we are nowhere near that right now so I look to fade signs of exhaustion, and now believe that the ¥130 level is a major ceiling in this market, as it is not only a large, round, psychologically significant figure, but it also is starting to attract the 20 day EMA. With all of that, I do believe it’s only a matter of time before the sellers would come back.
Please let us know what you think in the comments below
This article was originally posted on FX Empire
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