As you can see on the chart, I have a blue line at the 153 handle. If we can break above that line, it’s likely that we will see this market continue to reach towards the 155 level initially, and then the 160 handle. I believe that this would also be the beginning of the market rallying longer-term, and if we get buyers of stock markets out there jumping in, it could put enough “risk on” attitude out there to send this market higher because it is so sensitive to risk appetite. Remember, the Japanese yen is considered to be a safety currency, so this pair is supercharged when people are excited in a positive way.

Obviously, the opposite is true, but I think that the 150 level is going to offer significant support extending down to the 147.50 level. It’s not until we break down below there that I would be somewhat concerned. Until then, I think that it’s only a matter of time before we rally and climb much further. Ultimately, the market is at historically low levels, and I believe that eventually we will go looking towards the 190 level again, but that is a few years away. Longer-term traders will be looking to add to their positions in small bits and pieces, gradually building up a massive position in order to take advantage of the trend and profit from what could be a significant move over the longer term. If we do break down, I think it’s only a matter of time before the buyers would get involved.

GBP/JPY Video 02.01.18

This article was originally posted on FX Empire

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