GBP/JPY Price Forecast – British pound tests major support

The British pound fell initially during trading on Friday, breaking below the ¥145 level. However, we have seen buyers step in and pick this market up just below that level, as it has a certain amount of psychological and structural significance obviously. Beyond that, there is the 50 day EMA and the 200 day EMA just below there, and that of course will continue to offer a lot of interest to the market.

GBP/JPY  Video 25.03.19

The fact that we had formed a hammer during the Thursday session certainly doesn’t hurt either, so it’s very likely that value hunters are coming in to pick up the British pound after this pullback. We have a lot of noise coming out of the Brexit obviously, but at the end of the day we have a technical set up here that looks bullish. The one thing to keep in mind is that the headlines of course could work against you, but overall it appears that the slight reprieve that the European Union has offered the United Kingdom as far as time is concerned is working in favor of Sterling.

You should also keep in mind that the bullish flag underneath suggests that we are going to the ¥155 level, a target that I still have but I recognize may take some time to get to. That being said, is very likely that we will continue to see significant noise and volatility in this pair which is typically volatile under the best of circumstances. Shorting isn’t even thought right now.

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