British pound falls against Japanese yen in early Wednesday trading
The British pound initially drifted sideways early during the trading session on Wednesday but found plenty of selling pressure as we broke through the 153 handle, reaching down towards the 152 level. We did get a bounce from there, and by the time the Americans jumped on board we had recovered 50 pips worth of losses. I anticipate that this market will continue to be very noisy, it typically is. However, it looks as if the Bank of England is still on track to raise interest rates, regardless of deflationary fears. That of course is good for the British pound itself, and therefore I think we will see a recovery given enough time.
I currently recognize the 150 level as a significant “floor” in the uptrend, so if we can stay above that level, I’m looking for buying opportunities. Short-term bounces, or perhaps even a continuation of the upward momentum that we had seen after the significant fall, could be reasons enough to put money to work. Remember that this pair is highly sensitive the global risk appetite, so pay attention to what stock markets are doing around the world. I believe that eventually we should see this market reach towards the 153.75 level again. In might take a bit of work, but certainly there seems to be buyers underneath. At the first hint of positivity in the world’s financial markets, this pair tends to rise.