GBP/JPY Price Forecast – British Pound Continues to Press Against Resistance

The British pound initially has fallen during the trading session on Tuesday but then bounced significantly to break above the ¥134 level. We continue to see the British pound offer a lot of support, but one would have to suggest that perhaps we are running into a significant amount of trouble here. Furthermore, this pair is highly sensitive to the global economic outlook which of course is a complete tossup at this point. It typically, the less certainty there is the more negative the market behaves. Beyond that, we have had a significant bounce and therefore a pullback would be expected. It is because of this that I am willing to sell this pair on a break down below the lows of the Monday candlestick.

GBP/JPY Video 01.04.20

To the upside, if we were to break above the ¥135 level it’s very likely that we could go looking towards the gap that previously formed near the ¥137 level. It’s already been filled but these areas do tend to attract price time and time again. With all that being said, let’s start to think about the possibility of safety, which of course drives up the value of the Japanese yen. One feels that it would only take a slight nudge to make the markets rollover. Ultimately, I’m a little bit concerned about risk appetite so therefore I do favor the downside, but we need to clear the bottom of that Monday candlestick before I would be a seller. Otherwise, you can’t argue with the markets and you simply have to follow it to the upside.