The British pound fell initially during the day on Thursday, but bounced from the 145.50 level, and then turned around to fall again, only to find buyers yet again. This is a market that tends to be very volatile anyway, and I think that the bullish pressure may continue, but it is going to be very difficult. I think that the 147.50 level will more than likely offer resistance. However, I think that the market will continue to be very loud and noisy, and the added specter of possible headlines coming out of London or Brussels involving the breakup of the British and the European Union will make this market dangerous. I think that the markets continue to bounce around in this general vicinity over the next couple of sessions, as we tried to sort out where to go next.
Small positions
I believe that the best way to play this market is going to be with smaller positions, because of the volatility and the sudden turns that will happen. Because of this, it’s better to take small profit instead of taking huge losses. Quite frankly, this is a market that I think is going to be very difficult to handle at times, but I think if we can break to a fresh, new high from a couple of sessions ago, it’s likely that we will then go to the 150 handle, which is what I think will happen given enough time. In the next several sessions though, I would expect a lot of noise, and that could mean a lot of trouble. Alternately, if we break down below the 145 handle, this is a market that should then go down to the 143.50 level which is massive support on the longer-term charts.
GBP/JPY Video 14.7.17
This article was originally posted on FX Empire