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The British pound pulled back initially, only to find strength against the yen

The British pound initially pulled back during the trading session on Monday, testing the 151 handle. However, we found enough support to turn things around as we continue to find buyers on value, and it looks like we are trying to form some type of base.

The British pound pulled back initially during the trading session on Monday, reaching down towards the 151 level. This is an area that has offered a bit of support more than once, and it looks as if we are trying to turn things around. If we can break above the highs of the session on Monday, I think that the market could go higher, perhaps reaching towards the 152.50 level where we find resistance above. I think short-term pullbacks will continue to be buying opportunities, as we have had such a significant pullback as of late, as it gives us an opportunity to pick up value. Remember that this pair is highly correlated to the overall risk appetite of traders around the world, as this pair tends to follow stock markets in general, as well as commodity markets to a smaller extent.

I believe that the 150.75 level underneath is supportive, and it’s likely that if we break down below there we will go towards the 150 handle. In general, I like buying this pair as the British pound has shown signs of strength as of late, even though Mark Carney recently suggested that perhaps interest rate hikes are farther away than people thought. In general, the Japanese yen will continue to soften if risk appetite continues to show signs of strength. Ultimately, I do believe that we go higher and go looking towards the 155 level above, which is important on longer-term charts.

GBP/JPY Video 24.04.18

This article was originally posted on FX Empire

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