GBP/JPY Price Forecast – British Pound Shows Support Against Yen

The British pound fell a bit during the trading session on Wednesday, reaching down towards the 50 day EMA before bouncing significantly. The hammer that is trying to form for the trading session is a very good sign, and it’s very likely that the market should continue to go higher, perhaps reaching towards the ¥148 level. The bullish flag has offered plenty of support again, and now it looks as if we are ready to go higher. This is a market that has a lot of noise involved in it, but quite frankly it is a risk averse or risk appetite driven market.

GBP/JPY  Video 09.01.20

At this point, it shows that even though there has been a lot of negative headlines out there, traders are still looking to take advantage of the upward momentum, and at this point it almost looks as if we are forming a bit of a “falling wedge”, which is a bullish sign once we break out. The fact that we have bounced so hard during the trading session it tells me that there is a significant amount of support built into the bullish flag that I have marked on the chart. The ¥140 level underneath is still going to be an area that attracts a lot of attention not only because of the bullish flag but also because of the market is looking for a return as they get away from the Japanese yen. If we were to break down below the ¥139 level, then it suggests that perhaps we have more trouble ahead.

Please let us know what you think in the comments below