GBP/JPY Price Forecast – British pound rallied slightly on Friday

The British pound was a bit choppy during the trading session on Friday, but as you can see we are looking to finish the day with a positive candle. The ¥140 level above there is major resistance, and I think it will take quite a bit of work to get above there. If we can break above the ¥141 level, that would be very bullish, but I also recognize that the 50 day EMA is starting to reach that level as well, so that makes it even more important. However, I recognize that this pair is very sensitive to global risk, something that will make it especially vulnerable right now.

GBP/JPY  Video 14.01.19

If the US/Chinese trade relations can pick up a bit, that should help this pair going forward. However, we also have to worry about the Brexit, as it of course is a major driver of where the pound is going to go next. We have recently seen a lot of technical damage to this pair, so I certainly think that is going to be a lot easier to drop from here that it is rally. I think that we could also watch stock markets to see if there is a bit of panic out there, and if it comes this will be the first place I will be shorting. With all of the technical damage that has been done recently, I think it makes sense that there’s only a certain amount of support underneath. I do favor the downside trading, but the question is whether or not we can do it here, or if we do it from higher levels.