The British pound has broken below the 50 Week EMA initially during the course of the week but then turned around a break above the ¥ 152.50 level. That is an area that should continue to be of interest, but I think at this point in time you have to look at the larger range overall, with the ¥ 150 level underneath is massive support, that extends down to the ¥ 149 level. On the upside, the ¥ 155 level is significant resistance, and I think we could see quite a bit of selling pressure there.
GBP / JPY Video 14.03.22
Quite frankly, the market is likely to see a lot of volatility due to the massive amounts of problems out there. Keep in mind that the market is highly sensitive to risk appetite, so that is something that should be paid close attention to. I believe that this is a market that will continue to bounce around in an overall consolidation area as laid out previously, so more often than not longer-term traders are going to be focusing on daily charts, not weekly ones.
Pay close attention to stock markets around the world because they may give you a little bit of a “heads up” as to where we are going. If risk assets continue to strengthen, that would help this pair go higher, just as the exact opposite would be true. Regardless, this is a very volatile market that we are in right now, and therefore you need to be very cautious about your position sizing. This is especially true in this market, as it does tend to be a bit more volatile than most currency pairs anyway.
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This article was originally posted on FX Empire