GBP/JPY Price Forecast – British pound continues to grind higher

The British pound initially pulled back during trading on Tuesday, but then turned back around the show signs of strength in order to test the top of what I’m looking at as a potential bullish flag. Ultimately, if we can break above the ¥144 level, we could kick off a bullish flag that extends for a huge move. Granted, there is a lot of resistance built into the 200 day EMA, so keep in mind that the market may be a bit choppy even if we do rally. Ultimately, we may pull back and reach towards the middle of the flag itself near the 50 day EMA. Obviously, both of these scenarios could be bullish in the end.

GBP/JPY  Video 20.02.19

The measured move from the bullish flag suggests that we could be going as high as ¥155, which of course is a very bullish sign. Obviously, this is a pair that is very explosive and can move quite quickly. It is because of this that the bullish flag has captured the imagination. I also believe that the British pound may have bottomed longer-term, and on this chart it looks to me as if the ¥140 level will be the “floor” in this market. If we can get good news coming out of the US/China trade relations and perhaps even a little bit of good news coming out of the Brexit, this pair will probably take off like a rocket. Pay attention to global risk appetite, it will be highly influential here, as it does tend to move with stock markets and the like.

Please let us know what you think in the comments below