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GBP/JPY Price Forecast – British pound grinds higher against safety of Japanese yen

By:
Christopher Lewis
Updated: Sep 26, 2018, 05:03 UTC

The British pound rose against the Japanese yen during trading on Tuesday as the world continues to shrug off bad news. The question now is whether or not the trade war is something that people truly fear, or has it just already been priced into the markets?

GBP/JPY daily chart, September 26, 2018

In a market that is highly sensitive to global trade, you would expect that the GBP/JPY pair would be collapsing at this point. After all, we have the United States and China becoming even more contentious with each other, but at the end of the day this pair continues to see buyers on dips. I think that’s indicative of what we are seeing in the British pound overall, because quite frankly it has been oversold for some time. I do believe that this market will continue to grind higher, and that the ¥150 level is a natural target for the bullish trader.

I think that the 147.50 level should offer a bit of support, and that all we need is some type of good news to send the market much higher. Even just the slightest hint of reconciliation between the UK and EU negotiators would be enough to send this market skyrocketing as we have seen more than once recently.

Pullbacks at this point will probably be short and violent, meaning that if you can get out of the way of the flow of negativity, you should be able to look for support at lower levels to begin nibbling away again. Overall, I believe that this market will continue to show plenty of resiliency, just as the British pound has in general against most currencies. Quite frankly, even though interest rates rising in the United States, were still in a low rate environment so people will take any type of outfit they can.

GBP/JPY  Video 26.09.18

About the Author

Being FXEmpire’s analyst since the early days of the website, Chris has over 20 years of experience across various markets and assets – currencies, indices, and commodities. He is a proprietary trader as well trading institutional accounts.

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