GBP/JPY Price Forecast – British Pound Rallies Again

The British pound has rallied a bit during the trading session on New Year’s Eve, as Donald Trump has announced that the “phase 1 deal” with China will be signed January 15, leading to a risk on rally. Ultimately though, this also has to do with Brexit and the fact that we are getting a little bit of stability. By pulling back towards the 50 day EMA and bouncing, we have seen signs of strength going forward, and it looks as if the market will go looking towards the highs again. The market obviously will shun the Japanese yen if we get a major “risk on” type of situation, while the British pound of course gets a bit of a boost due to the potential certainly coming into play.

GBP/JPY  Video 02.01.20

At this point, I anticipate that the market goes looking towards the ¥148 level, and then eventually the ¥150 level. We had recently broken above a flag that measured for the ¥150 level, so I stick to that forecast, although I recognize that it will probably take some time to get there. With that in mind, I am a longer-term “buy-and-hold” type of trader, but I also recognize that you can build up a core position rather slowly, adding on dips going forward. With that, I believe that the market is going to continue to go much higher not only due to the recent headlines, but the fact that it is historically cheap at this point. I have no interest in selling this pair.

Please let us know what you think in the comments below