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Christopher Lewis
GBP/JPY

The British pound has started to grind just a bit to the upside against the Japanese yen on Thursday after the jobs number. Having said that, the market has also pulled back a bit from the highs, so I think this is going to be more of the same confusion that we have seen for some time. When you zoom out, we are making “higher lows”, so that is something worth paying attention to. Regardless, this is a market that I think is going to continue to struggle going higher, and we could be losing steam in the upward momentum.

GBP/JPY Video 03.07.20

If we break back down below the 50 day EMA, then it is likely we could go looking towards the ¥132 level. Right now, the major barrier is the ¥135 level, and then after that will be the 200 day EMA. Quite frankly, this is a pair that is struggling to find directionality and it seems as if we are one extremely bad headline away from seeing money flow back into safety assets such as the Japanese yen. It is because of this and the fact that we still have to deal with Brexit that I am very leery about buying this market. That being said, it does look like we are at least trying to change the trend, so I think you will continue to see a lot of erratic and choppy back and forth behavior. I would keep my position size an exceedingly small in this pair.

For a look at all of today’s economic events, check out our economic calendar.

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