GBP/JPY Price Forecast – Pound Continues to Grind Away at Resistance
The British pound has rallied early during the trading session on Tuesday but has also given back some of the gains. Nonetheless, we are forming an ascending triangle that suggest we are going to break above the ¥140 level given enough time. This of course would be a very bullish turn of events as this is a risk sensitive currency pair and therefore if it rallies, it would be a good sign for overall growth. A break above the ¥140 level opens up the possibility of a move to the ¥142 area, perhaps even higher than that.
GBP/JPY Video 02.12.20
To the downside, the 50 day EMA is sitting around the ¥137.50 level, and therefore it is likely that the buyers would show up there, as we have seen support at that level. The 200 day EMA is sitting at the ¥137 level, which I see as essentially the bottom of the overall range that we have been in. Given enough time, I fully anticipate that we go around in this area until the buyers overcome the resistance.
The one outlier of course is that there is a “no deal Brexit”, which is something that I think most people are starting to get away from the idea of, because regardless of what happens, it seems as if the two sides are always ready to come back to the negotiating table and therefore most of the bluster through the media can essentially be ignored as there is no follow-through on any of the threats that we have seen over the last four years.
For a look at all of today’s economic events, check out our economic calendar.