GBP/JPY Price Forecast – British Pound Breaks Big Figure

The British pound got hammered during the trading session on Thursday, slicing through the ¥135 level. This was directly after the Monetary Policy Committee announcement and meeting during the day, as we see absolutely no hope or whiff of inflation coming out the United Kingdom. Furthermore, we have to worry about the Brexit situation, which is only getting more complicated, not better. With that being the case, it makes sense that we would see the British pound fall, and this would be especially true against the Japanese yen which is considered to be a safety currency overall. With this, we are testing the ¥134 level, an area that has sent this market to the upside.

GBP/JPY Video 18.09.20

If we break down below there, and it certainly looks as if we could make an attempt to do so, the market is likely to go looking towards the ¥132 level where the initial move started. As far as buying is concerned, I will be doing so until we can break above the various candlesticks earlier in the week that long wicks to the upside. If we were to break above the ¥136.50 level, then we would have to take on the 200 day EMA. In other words, the path of least resistance is most certainly to the downside and will probably remain so until we can get some type of forward motion on Brexit. Given enough time, it probably does not even matter the result of Brexit, just that it is finally decided. At that point, the British pound probably becomes a longer-term “buy-and-hold” proposition, but right now it looks like it is going to be very vulnerable to the latest rumors and noise.

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