I’m not much help at the moment as I simply don’t have a good sense of what’s happening in the market. Are we going to see a continuation of the bull GBP trend? Do the AUD and JPY keep tumbling? Could we see a big retracement in GBP/JPY? I’m really not sure on the latter, it’s certainly possible, but I do think that the overall GBP bull move will continue into Feb/March.

I find that the best way to get a feel for the shorter-term market is to trade it in small amounts near important pivot points. Only when I have a position can I get a good feel for the market. The levels I’m looking at today are:

  • AUD/JPY: 90.00 (previous support) and 90.50 (38.2% of last week’s steep drop);
  • GBP/JPY: 170.60 (hourly T/L and 61.8% retracement);

Let’s see what happens at these important levels.