GBP/JPY Weekly Price Forecast – British pound drops for the week

The British pound pulled back during the week, reaching towards the ¥147 level underneath. Overall, I think that the market breaking down below there would be a very negative sign, because of the hammer from the previous week, and it would turn into a “hanging man.” Beyond that, we could drop down and break below the bottom of the shooting star that I mentioned previously, which of course would be very negative. At this point, I anticipate that the market breaking below there would probably be accompanied by some type of major negative headline, perhaps an increase in tensions between the United States and China.

There of course is the possibility of a Brexit announcement that has people freaked out, so it’s possible that the pair would fall from that as well. However, short-term traders will probably continue to show signs of interest in this pair near the ¥147 level, and if we don’t get some type of negativity, I would fully anticipate the consolidation going forward. Overall, if we were to break down, I think that the market probably drops to the ¥145 level. Alternately, if we do turn around and rally above the ¥150 level, then I think it opens the door to the ¥152.50 level. Expect volatility, which of course is the norm for this pair under normal circumstances, let alone all the moving pieces that we have out there at the moment.

GBP/JPY  Video 15.10.18