[ad_1]
British Pound vs Japanese Yen Technical Analysis
The British pound initially plunged against the Japanese yen during the trading session on Friday, as the Bank of Japan announced that it was going to relax some of the yield curve control policies, therefore allowing interest rates in Japan to rise a bit. That being said, the reality is that the market still has a huge interest rate differential between the 2 currencies, and after the initial selloff, it appears that a lot of traders paid attention to that fact. We have since rallied quite significantly, forming a massive bullish candlestick.
The market broke back above the 50-Day EMA, and raced to reach above the ¥180 level, almost wiping out the entirety of the candlestick from the previous session as well. This shows a significant amount of wherewithal in this market, and therefore it’s worth noting that the market has shown just how aggressive the buyers are going to be, and therefore I think it’s probably only a matter of time before we see buyers jump into this market. That being said, if we were to break down below the bottom of the nasty candlestick from the Friday session, that would obviously be very negative, and the ¥175 level underneath would be tested. Anything below the ¥175 level opens up a pretty significant selloff.
All things being equal, this is a market that I think I will be buying on dips, taken advantage of that positive swap. Furthermore, it looks like we are getting ready to go to the ¥182.50 level, and then possibly the ¥184 level after that. Anything above that level then opens up the ¥185 level, and possibly more of a “buy-and-hold” scenario. By the end of the year, it would not shock me to see this market go all the way to the ¥200 level. Obviously, it will take a certain amount of time to get there, but I still look at this through the prism of trying to get long every time I can, but also recognizing that this is a market that is very noisy under the best of circumstances.
For a look at all of today’s economic events, check out our economic calendar.
[ad_2]
Source link
