The British pound initially tried to rally during the trading session on Monday but found quite a bit of resistance above will to turn around and find negativity. At this point, the market looks likely to continue going lower, but that does not necessarily mean that we get there right away.
GBP/JPY Video 30.06.20
First and foremost, you should remember that this pair is sensitive to risk appetite. That is because the Japanese yen is considered to be a “safety currency.” At this point in time, the market is likely to see that situation play out further, but there is the possibility that the market will bounce around in the meantime. At this juncture, it is likely that there will be the attempted rally from time to time, but at this point it is obvious that sellers have been pushing lower. I think this continues to be the case, with the 50 day EMA above offering significant resistance.
Looking at this chart, the ¥132 level is offering a bit of support, but if we break down below there it is likely that we go looking towards the ¥130 level where we have a large, round, psychologically significant figure. That of course attract a lot of money, and big players get involved in the market in both directions there. Ultimately, I do believe that we probably go looking towards the ¥129 level, but it may take some time to get there. Breaking above the 50 day EMA could change some things, but then you would have to worry about the ¥135 level above that should offer a bit of resistance. Both the 50 day and the 200 day EMA indicators are sloping lower, so that does suggest that the downtrend is going to continue into the future.
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This article was originally posted on FX Empire
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