GBP/JPY Weekly Price Forecast – British Pound Breaks Through Support but Recovers

The British pound broke down a bit during the trading sessions that made up the week as the ¥132 level being broken through is a negative turn of events, but during the day on Friday the market raced right back towards that area. Overall, this is a market that had been consolidating so now the question is whether or not we break down through the bottom of the candlestick and continue going lower, or do we return to the overall consolidation that had been a major feature of April? That is what this next candlestick is going to be, so because of this it will be crucial to pay attention to what this candlestick says.

GBP/JPY Video 11.05.20

The currency pair is sensitive to risk appetite, so you should pay attention to how that is being affected. The jobs number on Friday of course were a little bit better than anticipated, so Friday may have skewed the candlestick to the upside a bit more than expected. That being said though, I anticipate that next week will show us the reality of this currency pair. The British pound has a lot of overhang when it comes to concerns anyway, not the least of which would be the problems with Brexit. Furthermore, you also have to have concerns about global growth, which is a help for the Japanese yen in general. I do favor the downside, but I am not going to argue with the overall markets, and it will simply follow a break down or sit on the sidelines.