British pound continues to flex muscles against Japanese yen

The British pound rallied initially during the day on Monday but pulled back a bit to test the ¥146 level. I think that eventually the market will continue to go higher, perhaps reaching towards the ¥150 level. The ¥145 level underneath should be massive support, and I think that the markets will continue to find plenty of buyers on these pullbacks, and I think that any type of bounce could be a small buying opportunity. Overall, I believe that the market will attempt to go higher based upon risk appetite, and it will more than likely follow stock markets around the world and the reaction to potential trade wars.

If we break down below the ¥143.50 level, then we will unwind to the ¥140 level at the very least. That would be an extraordinarily negative show force, perhaps breaking down significantly. I think that the market is trying to form some type of bottoming pattern after selling off, and of course I think that the volatility will continue to be a major portion of the way this market works. I think that the ¥150 level above being broken to the upside of course would be a majorly bullish sign, but we have a lot of work to even begin that conversation. At this point, it does look like we are trying to build up the necessary momentum to go to the upside though, but I would keep my position size a bit small because of potential troubles.

GBP/JPY  Video 05.06.18