GBP/JPY Price Forecast – British pound chops against Japanese yen

The British pound gapped lower during the open on Monday, only to turn around and fill that gap. At this point, it’s interesting to see whether or not the market can continue to go to the upside, or will it simply roll over as the moving average suggests?
Christopher Lewis
GBP/JPY daily chart, October 08, 2019

The British pound gapped lower to kick off the trading session on Monday, but then turned around to fill that gap. The confusion that the market has seen over the last couple of days makes quite a bit of sense, as this pair is so highly sensitive to risk appetite. Ultimately, this is a market that will continue to show signs of choppiness as we have a lot of different geopolitical concerns and trade issues out there. Beyond that, we also have Brexit when it comes to this pair as well, so this is an especially sensitive Japanese yen pair.

GBP/JPY  Video 08.10.19

To the downside, the market could go looking towards the ¥130 level, and with the 50 day EMA above offering such a significant psychological and structural resistance, we could find a reason to get down there. Quite frankly, we are only one headline away from seeing this market role right back over again, or for that matter rally. If we were to rally than I suspect that the ¥135 level above will be difficult to break through. All things being equal, this is a market that is probably going to remain very difficult to hang onto, as it tends to be very volatile under the best of circumstances. In this current environment, things can only get worse would be my suspicion. Position sizing will be crucial when it comes to trading “The Dragon”, as when it finally makes its move it will probably be sudden and quite brutal.

Please let us know what you think in the comments below

Don't miss a thing!

Discover what's moving the markets. Sign up for a daily update delivered to your inbox

Latest Articles

See All

Expand Your Knowledge

See All
IMPORTANT DISCLAIMERS
The content provided on the website includes general news and publications, our personal analysis and opinions, and contents provided by third parties, which are intended for educational and research purposes only. It does not constitute, and should not be read as, any recommendation or advice to take any action whatsoever, including to make any investment or buy any product. When making any financial decision, you should perform your own due diligence checks, apply your own discretion and consult your competent advisors. The content of the website is not personally directed to you, and we does not take into account your financial situation or needs.The information contained in this website is not necessarily provided in real-time nor is it necessarily accurate. Prices provided herein may be provided by market makers and not by exchanges.Any trading or other financial decision you make shall be at your full responsibility, and you must not rely on any information provided through the website. FX Empire does not provide any warranty regarding any of the information contained in the website, and shall bear no responsibility for any trading losses you might incur as a result of using any information contained in the website.The website may include advertisements and other promotional contents, and FX Empire may receive compensation from third parties in connection with the content. FX Empire does not endorse any third party or recommends using any third party's services, and does not assume responsibility for your use of any such third party's website or services.FX Empire and its employees, officers, subsidiaries and associates, are not liable nor shall they be held liable for any loss or damage resulting from your use of the website or reliance on the information provided on this website.
RISK DISCLAIMER
This website includes information about cryptocurrencies, contracts for difference (CFDs) and other financial instruments, and about brokers, exchanges and other entities trading in such instruments. Both cryptocurrencies and CFDs are complex instruments and come with a high risk of losing money. You should carefully consider whether you understand how these instruments work and whether you can afford to take the high risk of losing your money.FX Empire encourages you to perform your own research before making any investment decision, and to avoid investing in any financial instrument which you do not fully understand how it works and what are the risks involved.
FOLLOW US