The British pound has rallied a bit during the course of the trading session on Thursday to reach towards the upper part of the candlestick from Wednesday which of course was a shooting star. At this point, the market looks as if it is trying to get to the ¥152.50 level, an area that has been significant resistance in the past. With that being the case, the market is likely to continue to see it as important. Ultimately, this is an area that I think will be very difficult to break, but it certainly looks as if we are trying to get to that region.
GBP/JPY Video 03.09.21
However, if we break down below the candlestick from the Wednesday session, that could send this market lower, possibly opening up a move down to the ¥150 level. The ¥150 level will be significant support that extends down to the ¥149 level. That is a major barrier, because if we break down below there it is likely that the market falls rather hard, perhaps reaching towards the ¥145 level, maybe even as low as the ¥140 level.
All that being said, the market does not look likely to pull back after this last couple of days, but it does not necessarily mean that we are going to shoot straight up in the air as well. In general, this is a market that will move back and forth with risk appetite, so obviously Friday will probably be a very noisy day. Whether or not it is a trend defining candlestick is a completely different question.
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