GBP/JPY Price Forecast – British Pound Pulls Back Slightly

The British pound went back and forth during the trading session on Monday, as we continue to see a lot of choppy behavior. It looks to me as if the ¥135 level is starting to cause major issues, but I think eventually we will make a significant move in one direction or the other. The gap above and the 200 day EMA both are near the 61.8% Fibonacci retracement level, which is at the ¥137 level. At this point, this is the most likely of scenarios, but only if we continue to get a “risk on rally” in things like the stock market. Do I think that this lasts for the longer term? Probably not. However, it’s clear to me that there is more bullish pressure than bearish overall.

GBP/JPY Video 14.04.20

The alternate scenario is that we break down below the ¥134 level, which should send this market down to the ¥133 level. The 50 day EMA above is of course going to cause a little bit of resistance, so we should pay attention to that as well. I do believe that it’s only a matter of time before the market has to make up its mind but right now it’s a bit much to ask during a trading session that was driven mainly by Americans and a few random banks here and there around the world. The real tell will be on Tuesday, and how that market session behaves. Expect a lot of choppy and noisy behavior, but ultimately, we will get an impulsive candlestick that we can follow for a bigger move.