GBP/JPY Price Forecast – British Pound Continues Lack of MomentumThe British pound initially fell on Tuesday but turned around to show signs of life as we continue to see a lot of buying and selling on short-term charts.
The British pound initially fell a bit during the trading session on Tuesday, only to turn around and reach towards the 50 day EMA again. With that being said, the market is likely to continue seeing a lot of sloppy trading as both the 50 day and the 200 day EMA indicators are flat, showing that we have nowhere to be. As long as that is the case, we are talking about very lackluster trading and short-term at best. Because of this, you should keep your position size rather small.
GBP/JPY Video 28.10.20
To the downside, the ¥135 level looks to be rather supportive, while the ¥138 level above looks to be rather resistive. In other words, we are dead smack in the middle of the consolidation area, which is also suggested by the moving averages. This is a market that is simply running out the clock when it comes to Brexit and the US elections, as both of them are major events for risk appetite. In other words, I would not anticipate this market giving us huge opportunities anytime soon, as the next week or so will more than likely be very choppy and short-term trading at best.
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Be aware the fact that as we get closer to Tuesday, the US election results start to come into play and therefore the markets could become very volatile. This will be especially true in pairs like this, which tend to run on market sentiment more than anything else. With this, I anticipate that we simply fade the market going to the outer bounds of the range that we are in between now and then.
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