British Pound Reaches ¥160

The British pound has shot straight up in the air during the trading session on Tuesday to reach the ¥160 level. This is an area that has been important multiple times in the past, and therefore it is not a huge surprise to see that the market may have been interested in it. The parabolic nature of this move is a bit overdone though, so I do expect to see a bit of a pullback.

GBP/JPY Video 23.03.22

While I would not necessarily look to short this market, I do think that you could get a wicked pullback rather quickly if you see any type of normalcy come back into this market. On the other hand, if we simply blow through the ¥160 level, that would actually be a very dangerous sign, showing that the market has gotten far too ahead of itself and is in now what I would consider being a “blow-off top.” This would be a sign that trouble could be coming because these typically and horribly.

That being said, if we get some type of significant pullback, then a buying opportunity could present itself. The market has gotten so far ahead of itself though, I think that if you are already long, you need to start thinking about an exit plan. At the very least, you should be looking at a way to lock in some of these massive gains. Ultimately, this is a market that is reaching the absurd, but there is no reversal signal quite yet. As long as the market looks like this, you are either already in it, or simply waiting.

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