The British pound has initially fallen during the trading session on Monday but has turned around a break above the ¥140 level. By doing so, the market looks as if it is going to go looking towards the ¥141 level again, and if we can break above the highs from a couple of weeks ago, it’s very likely that we will kick off what looks to be a bullish pennant.
Just below, the 200 day EMA should offer support and the 50 day EMA is starting to turn higher in order to form a bit of a “golden cross”, which of course is a very bullish sign for longer-term traders. This is in congruence with the overall trend of the British pound, and of course risk appetite around the world. This pair does tend to follow that, despite the fact that Brexit also causes a lot of headlines. If stock markets rise, as a general rule over the years this pair has risen right along with it as the Japanese yen is considered to be a “safety currency.”
You can see that we are currently hanging around the 61.8% Fibonacci retracement level and experience tells me that if we were to break above there cleanly, it’s very likely that we will go to the 100% Fibonacci retracement level. Further compounding that argument is the fact that the pole from the pennant measures for a move to roughly the same area, right around ¥149. In the short term, it looks as if buyers keep coming back for pullbacks that offer little bits of value here and there, although one can definitely make the argument that we are simply waiting around for the catalyst to push the markets higher. In the meantime, look for value on short-term dips, it has paid off quite nicely as of late.
Just below, the 200 day EMA should offer support and the 50 day EMA is starting to turn higher in order to form a bit of a “golden cross”, which of course is a very bullish sign for longer-term traders. This is in congruence with the overall trend of the British pound, and of course risk appetite around the world. This pair does tend to follow that, despite the fact that Brexit also causes a lot of headlines. If stock markets rise, as a general rule over the years this pair has risen right along with it as the Japanese yen is considered to be a “safety currency.”
You can see that we are currently hanging around the 61.8% Fibonacci retracement level and experience tells me that if we were to break above there cleanly, it’s very likely that we will go to the 100% Fibonacci retracement level. Further compounding that argument is the fact that the pole from the pennant measures for a move to roughly the same area, right around ¥149. In the short term, it looks as if buyers keep coming back for pullbacks that offer little bits of value here and there, although one can definitely make the argument that we are simply waiting around for the catalyst to push the markets higher. In the meantime, look for value on short-term dips, it has paid off quite nicely as of late.