- It looks like the British pound will continue to be very noisy against the Japanese yen.
- It also looks like the ¥200 level continues to attract a certain amount of attention.
- This does make sense. It's a large round number, and a lot of people love these large round numbers as a marker, if you will, of where we might be going.
In general, this is a market that I think you need to be very cautious with, at least in the short term. But I do think it is probably only a matter of time before we break above the recent high near ¥200.80. Anything above there becomes more or less a buy and hold scenario. And with that, I think we probably go looking to ¥202 rather quickly.
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I have no interest in shorting
Regardless, I don't have any interest in shorting this market. It is far too strong of a market to get too cute in, and therefore I look at any pullback and as a potential opportunity, I'm very interested in the 197.6 level, which is an area that previously had been resistance, and it should show support yet again when we pull back there as we had seen over the last couple of days.
The 50 day EMA is closer to the 195.88 level, and then after that we have multiple areas extending all the way down to at least the 190 and level. In general, this is a market that continues to pay close attention to the interest rate differential. The interest rate differential, of course, favors the British pound.
Remember, you get paid at the end of every day to take advantage of being long of this market. And although we have the jobs number on Friday, I do think that the volatility on Friday will probably be used as an opportunity to get long yet again. After all, this has been a very reliable uptrend, and for good reason.
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