GBP/JPY Price Forecast – British Pound Continues To Press Resistance

The British pound continues to show signs of underlying demand, as the market has been grinding around the ¥140 level for some time. After the initial surge higher, it now looks as if the market is prepared to digest those gains.
Christopher Lewis
GBP/JPY daily chart, November 06, 2019

The British pound has gone back and forth against the Japanese yen over the last couple of weeks, simply digesting gains from the massive shot higher that we had seen previously. The market is now above the 200 day EMA, and therefore it’s likely that we will continue to see this market go higher eventually. If we can make a fresh, new high, that would lead to a run towards the 100% Fibonacci retracement level above, which is the ¥149 level.

GBP/JPY  Video 06.11.19

Currently, the 200 day EMA is offering massive support, and it should continue to attract a lot of attention as per usual. Ultimately, this is a market that will find a reason to go higher, based upon the fact that it’s now one of the worst kept secrets in the world, the British pound has bottomed. This doesn’t mean that we can’t have a wicked pullback, but at this point it looks very likely that short-term pullback should be thought of as buying opportunities. Ultimately, this is a market that should feature a lot of “buying on the dips” going forward, and of course value hunting. That being said, if we were to break down below the 200 day EMA, it’s likely that the market goes down towards the ¥135 level which would be massive structurally as well and could be a great place to pick up even more value. Currently, I have no interest in shorting this pair even though I do recognize that it is a bit overbought.

Please let us know what you think in the comments below

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