GBP/JPY Price Forecast – British pound find support again

The British pound broke down initially during the day on Thursday but turned around quite drastically to break back above the 50 day EMA now that the Bank of England announcements are out of the way.
Christopher Lewis
GBP/JPY daily chart, February 08, 2019

The British pound pulled back a bit during the trading session during the day on Thursday but has turned around to explode to the upside. We are now sitting on top of a major moving average in the form of the 50 day EMA, and now it looks as if we are getting ready to break higher again. This is an area that should continue to send this market looking towards the 200 day EMA. At this point, I believe that the ¥145 level above should continue to be a major level that people will pay attention to as well, so keep this in mind.

GBP/JPY  Video 08.02.19

This is an extraordinarily strong candle stick, and I believe that we are getting ready to rally yet again. When I look at the chart, I think that the market will continue to find plenty of value hunters in the British pound, and if we can get the US/China trade relations going a little bit better, that should send this market higher as well. Remember, this is a market that is highly levered to risk appetite in general, and therefore I think that the market participants will continue to find value on dips. I don’t know if we can break above the ¥145 level quite yet, but clearly the British pound is trying to bottom. I continue to buy on dips and I believe that the ¥140 level is now acting as a significant floor in the market. If we break down below there, then things could get ugly.

Please let us know what you think in the comments below

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