The GBP/JPY pair had a very volatile week, initially rallying, but giving up about half of the gains. We are above the 145 handle, so that of course is important but given enough time the real fight is probably closer to the 148.50 level above. That should continue to be a massive resistance barrier, and if we can break above there I believe that we will then go looking towards the 152 handle. Obviously, the 150 handle between 148.50 and 152 will cause a certain amount of attention, as it is a large, round, psychologically significant number. I believe that there is an uptrend line underneath that is forming a bit of an ascending triangle, so longer-term traders are probably better off to look at dips as buying opportunities.
Patiently buying dips
I believe that patiently buying dips will be the best way to go going forward, and that is how I am going to trade this market. I don’t have any interest in trying to short this market, as it so bullish as of late. In fact, I would have to see a move below the 140 level to start selling at this point. Ultimately, I believe that the market is bullish but it takes quite a bit of momentum to turn around a massive downtrend, and that should continue to offer plenty of opportunities on dips. Given enough time, we could go looking for the 165 handle, but that probably won’t be seen until late this year, perhaps even 2018.
GBP/JPY Video 31.7.17
This article was originally posted on FX Empire