GBP/JPY Price Forecast – British Pound Gets Hammered

The British pound has got absently hammered during the trading session on Friday, slicing through the 50 day EMA and then reaching down towards the 200 day EMA as it is now looking more likely that there might be a “no deal Brexit” according to the main negotiators in the situation. Ultimately, this is a market that is highly sensitive to risk appetite to begin with and is quite volatile at times. It is because of this that the market is likely to break down even further, assuming that the headlines do not get any better. For what it is worth though, I must admit that even though we sold off rather hard early in the session, it is at least trying to stabilize around the 200 day EMA which shows just how resilient the British pound has been.

GBP/JPY Video 14.12.20

To the downside, the ¥135 level would be a support level, and I think a lot of people would be paying close attention to it there. The biggest problem with trading this pair right now is that if you were to get involved heading into the weekend, it is very likely that you will be waking up Monday morning to some type of massive gap. It is because of this that caution is advised, and it does make quite a bit of sense that a lot of traders will simply be sitting on the sidelines and waiting to see what happens over the weekend. With this being the case, I would avoid this pair at all costs in the short term, waiting to see how the week opens up.

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