The size of the daily candlestick certainly suggests that there is a lot of selling pressure and momentum is on the downside. Looks like the market is right again. There has been talk of the Bank of England changing their general monetary policy and that immediately makes people think they are going to let interest rates rise. As a result, the Japanese yen was by far one of the best performers in the forex world on Thursday. This sent GBP/JPY below the ¥160 level, which is obviously a psychologically important area. At this point, I think it’s probably only a matter of time before we continue to taper off if you think about monetary tightening in Japan. However, if they actually walk it back, I expect the yen to bomb. Advertisement Are you ready to place your orders? OPEN FREE PRACTICE ACCOUNT However, I think we have reached a point where it is obvious that the Japanese yen is exhausted and it is more likely that the yen will continue to strengthen. There is almost a „death knell” emerging in this pair, as the 50-day EMA falls below the 200-day EMA, forming a very bearish signal for longer-term traders. In this environment, it’s very likely that you’ll see selling pressure whenever we get a bit of news, and so I think a lot of traders will be watching this area closely. Strong selling pressure On the downside, the 155 yen level is still important and more likely than not will provide some support on a pullback. Whether that is or not remains to be seen, but it makes some sense as we have seen a bounce out of this area, and of course it is a big, round, psychologically important indicator. With that in mind, I think your short-term goal, but a break from there will open a bottom and we can reach the 150 yen level pretty quickly. If we do, you will probably see the yen strengthen and the entire Forex world. In this environment, I think you will see a complete dismantling of the jeans that were so popular and profitable last year. The size of the daily candlestick certainly suggests that there is a lot of selling pressure and momentum is on the downside.