The British pound finds support against Japanese yenThe British pound bounced from the longer-term trend line that I have marked on the chart during the day on Monday, and therefore we have broken above the 148 level again. Because of this, I think that the market is trying to rally from here, but I suspect that we are going to continue to see a lot of selling pressure above.
The British pound has bounced from the 147 level below, breaking above the 148 level. By doing so, the market looks likely to attempt a breakout above the small cluster just above, but if we do get above there, I think there are plenty of areas above that could be sold, with the 150 level being massive resistance, and it’s not until then that I would consider this market as one that can be bought with any type of confidence. I believe that the market will eventually break down a bit more, before reaching down to the 146 level. I think longer-term, we could be looking towards the 145 handle as well, as it is a large, round, psychologically significant number and of course has offered reactions in the past.
If we did break above the 150 handle, then that of course would show a major shift in attitude, and it also gives us a couple hundred pips worth of positivity between now and then. That of course would be something to pay attention to as well, and therefore would be something that I can believe in. Until then, I think we are probably going to see sellers jump in on short-term rallies, and at the first sign of exhaustion. That has been the way going forward for several days, so I think we should continue underneath. The 145-level underneath is my longer-term target, but I also recognize is can you take a lot of work to get there.