The British pound has gone back and forth during the course of the trading session on Monday as we have been all over the place when it comes to risk appetite. After all, this is a pair that is very sensitive to risk appetite, and this is why we have seen so much in the way of noise. Looking at this chart, I believe that it is worth noting that the candlestick for the trading session on Monday shows a lot of confusion, and I think that is a good sign of what is ready to hit the market.
GBP/JPY Video 22.06.22
If we break above the top of the candlestick for the trading session on Monday, that would be very bullish, and I think we would go looking towards the ¥155 level. However, if we were to break down below the bottom of the candlestick it is very possible that we go looking towards the ¥150 level underneath. All things being equal, I think we are going to continue to see a lot of noisy behavior, but if we get more of a “risk off” type of attitude out there, then that will more than likely bring this pair lower.
If we break down below the ¥150 level, that could be a very negative sign, perhaps sending this market down towards the ¥147.50 level, and then after that down to the ¥145 level. In general, this is a market that I think you will need to be very cautious about your position size, but it is worth noting that we have been very bullish for a long time, so I am a bit hesitant to put a lot of money to work.
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