GBP/JPY Price Forecast – British Pound Pressing Major ResistanceThe British pound initially pulled back against the Japanese yen but then shot towards the upside as the market is likely to go head-on with the selling pressure. At this point, the market is likely to go higher, perhaps trying to fill the gap above or at least getting back to the ¥137 level.
The British pound has initially pulled back during the trading session on Tuesday, but then shot straight up towards the recent resistance. The question now is whether or not the market can continue to go higher, and if it does it’s very likely that it could go quite a bit higher. Obviously, we have seen a lot of resistance near the ¥134.75 level. If we can get above there, then it’s likely that the market shoots towards the ¥137 level which is where the 200 day EMA is. It’s also the scene of a previous gap and of course the 61.8% Fibonacci retracement level.
GBP/JPY Video 08.04.20
At this point, the market pulling back could make some sense though, but I would anticipate seeing a lot of support near the ¥132.50 level. This is a pair that is highly sensitive to risk appetite overall, so if we do continue to see a lot of bullish “risk on” type of attitude out there, I think that the market is more likely to break out and to the upside than it is anything else going forward. That being said, markets are currently trying to price in the risk scenario when it comes to the coronavirus numbers, which are currently looking a little bit better than they had been. Because of this, traders are trying to price in better news. The Japanese yen of course is a safety currency, so it makes sense that we should see money flow away from it.