GBP/JPY Price Forecast – British pound runs into resistance

The British pound went back and forth during Wednesday, testing the ¥145 level. That’s an area that has caused resistance and support in the past, so it’s not a huge surprise that we struggled. We just broke above the top of the bullish flag on Tuesday, and that of course is a very bullish sign. Considering this just happened, I do believe that short-term pullbacks give you an opportunity to pick up a bit of value, especially considering that the British pound has looked lately as if it’s trying to form a longer-term bottom.

GBP/JPY  Video 21.02.19

The British pound will of course continue to deal with the lot of noise coming out of the Brexit negotiations, but at the end of the day it’s very likely that the buyers will continue to jump into the market at signs of value. In fact, it’s not until we break down below the ¥141 level that I would be overly concerned.

Based upon the flagpole of the bullish flag, we could go as high as ¥155, possibly even ¥157. Obviously that’s a longer-term target, but that is how things measure out. Keep in mind that the US/Chinese talks of course will have an effect on this pair as it is highly sensitive to global risk, so good news out of that situation could also provide a bit of a lift in this market. Obviously, some type of agreement with the Brexit will be beneficial as well.

Please let us know what you think in the comments below