The British pound drifted a bit lower against the Japanese yen during the trading session on Tuesday, reaching down towards the 151.25 level. However, at the end of the day there is almost no volume in this market, so I’m not overly concerned as to what happened. I think that if the market pulls back lower from here, it will eventually be a nice buying opportunity that we can take advantage of, with the 150-level looking very likely to be the “floor” in the market. If we can stay above that level, I am only buying this pair, but I also recognize that with this type of marketplace, it makes sense to buy slowly and then add as it works out in your favor.
If we can break above the 153 level, the market becomes much more of a “buy-and-hold” scenario from the longer-term chart aspect, so that gives us an opportunity to become very aggressive at that point. However, until then caution is necessary as a turnaround should be a very noisy affair, it’s almost never a clean break. I think we are trying to see that happen right now, and it can take quite some time. If you look at the trend reversals and the yen related pairs over the years, they are almost always extraordinarily noisy, and quite often take months. We have been seeing this market grind higher over the last several months, and now have clearly a line of demarcation at 153. I am preparing for that break out, and with a little luck we could get an excellent moved to the upside, with the initial target being 163.
GBP/JPY Video 27.12.17
This article was originally posted on FX Empire