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GBP/JPY Weekly Price Forecast – British pound continues recovery

By:
Christopher Lewis
Updated: Aug 23, 2019, 16:53 UTC

The British pound recovered a bit during the week, breaking back above the ¥130 level, showing signs of life yet again. That being said, the question now remains whether or not this is the real thing, or is it simply just that a bounce from extremely low levels?

GBP/JPY weekly chart, August 26, 2019

The British pound initially fell during the week but then turned around to break above the ¥130 level. That being said, it’s an impressive move, especially considering after the previous week and its action. With that, it’s quite impressive but to be honest I believe that we are still simply just bouncing from extremely oversold conditions. Looking at this chart, I think that the recent break down needed to be pulled back from but given enough time I think that we will then go looking towards the ¥135 level.

GBP/JPY  Video 26.08.19

To the upside, I see the ¥135 level as an area that could cause a lot of interest, and I would be more than willing to sell some type of exhaustive candle stick there. Having said that, I don’t necessarily think that’s the base case scenario here. I think you will probably be better served looking at shorter-term charts to take advantage of what is obviously a very long term downtrend. Ultimately, this is a market that will continue to act upon the headlines from the Brexit, and of course risk appetite in general.

Keep in mind that this pair tends to fall with risk appetite going down, and let’s be honest it’s likely to take much to make that happen. At this point, the Brexit is also another headwind, so really there’s nothing to say other than this is a market you should be looking to sell. I believe the downtrend will continue and perhaps go looking towards much lower levels.

Please let us know what you think in the comments below

About the Author

Being FXEmpire’s analyst since the early days of the website, Chris has over 20 years of experience across various markets and assets – currencies, indices, and commodities. He is a proprietary trader as well trading institutional accounts.

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