GBP/JPY Price Forecast – British Pound Continues To Consolidate Against Yen

The British pound continues to be very noisy against the Japanese yen, as we have been trying to figure out where we are going next. This is a symmetrical triangle forming at the top of an impulsive move. Essentially, we are forming a pennant.
Christopher Lewis
GBP/JPY daily chart, November 11, 2019

The British pound has gone back and forth against the Japanese yen during trading on Friday, as we have been building a larger symmetrical triangle around the ¥140 level. At this point, market participants continue to look at this as an opportunity to grind away, because sooner or later we will have to make a decision. If we can break above the top of the triangle, then it could kick off a move towards the ¥150 level, which is basically where the 100% Fibonacci level is. That’s an area that typically gets tested after a break of the 61.8% fib, so therefore it makes quite a bit of sense.

GBP/JPY  Video 11.11.19

The 200 day EMA sitting below the pennant of course helps as well, so it’s very likely that traders will continue to see that as a bit of a “floor” in the market. Ultimately, even if we were to break down below the 200 day EMA it’s very likely that the ¥135 level will also cause a certain amount of support based upon structural trading previously. All things being equal, this is a market that you can only buy and not sell, even if we do break down just a bit. Remember, this is about Brexit and of course global growth/optimism, so if we can get good headlines from either one of those scenarios it’s likely that this pair will continue to go higher and eventually break out to much bigger figures. Pay attention to the GBP/USD pair as well, because it needs to break above the 1.30 level to get the British pound moving quicker.

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