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Christopher Lewis
GBP/JPY daily chart, September 21, 2018

The British pound has rallied again during trading on Thursday, as we continue to see value hunters come in and pick it up. The closer we get to some type of resolution with the European Union, even if it’s no resolution, the better off the British pound is going to be. For weeks now we have seen a new phenomenon: bad news comes out, the British pound cells off, and then turns around and rallies again. For me, this is a clear sign that the buyers are coming into pick up the British pound and being so historically cheap it makes sense that they would. Big money will be looking for opportunities to pick up the British pound “on the cheap”, so I believe that there’s a bit of a supportive floor underneath current levels.

I believe at this point if we get any resolution between the Americans and the Chinese, this pair will also rally as it is very sensitive to risk appetite overall. Ultimately, this is a market that I think will find a reason to go higher regardless, so at this point it’s likely that the buyers are going to continue to step in and continue to push. I have no interest in shorting this market, at least not until we would break significantly below the ¥147 level. Right now, that doesn’t look very likely happens and therefore I think building a large position is probably what I’ll be doing over the longer-term.

GBP/JPY  Video 21.09.18

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