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Christopher Lewis
GBP/JPY daily chart, September 27, 2019

The British pound has gone back and forth during the trading session on Thursday against the Japanese yen, as the markets quite frankly have no idea what to do next. The 50 day EMA has offered a certain amount of support, but there is also a significant amount of resistance above in the form of the ¥135 level that will most certainly come into play. Ultimately, if we were to break down below the ¥132 level, then this market probably continues lower, reaching towards the ¥130 level.

GBP/JPY  Video 27.09.19

Keep in mind that there is still a major problem in the form of the Brexit, as it is all over the place as well. This is a market that will have to deal with that circus in London and the European Union, so lots of volatility and shakiness will more than likely continue to be a major factor in this market. That being said, we are still very much in a downtrend despite the fact that we have had a nice pop higher. All things being equal, keeping a small position size probably makes the best way to trade this pair in general. We had gotten a bit parabolic over the last couple of weeks, and therefore it makes sense that we pulled back a bit. However, if we were to break above the ¥135 level, then we could make a move towards the 200 day EMA, but that would take a significant bullish move in either risk appetite or the Brexit situation to make that happen.

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