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GBP/JPY Weekly Price Forecast – British pound struggles to keep gains against yen

By:
Christopher Lewis
Updated: Apr 5, 2019, 17:08 UTC

The British pound rallied during most of the week against the Japanese yen but gave back quite a bit of it towards the end of the week as the market seems to think of ¥145 as a bit of a magnet for price.

GBP/JPY weekly chart, April 08, 2019

The British pound initially tried to rally during the week but gave back most of the gains to form a shooting star shaped candle at the ¥145 region. The bullish flag that I have marked on the chart still suggests that we are going to go looking towards the ¥145 level, but obviously there are enough headlines out there involving the Brexit to throw the market around and make that very difficult to happen. Longer-term, I do think it does come to fruition, but we obviously have a lot of work to do before that happens.

GBP/JPY  Video 08.04.19

If we were to break down below the vital ¥144 level, that would put a lot of the bullishness in serious trouble, as it would be a major breach of support from the last month and a half or so. We need to break above the ¥150 level to be cleared to go much higher. I still believe in buying pullbacks but recognize that if we were to break down below the ¥144 level, we could drop down to the ¥142 level, followed by the ¥140 level.

All of that being said, the market looks as if it is trying to bottom but these situations are always very noisy and long-term processes. We need some type of good news out of the Brexit to push higher, just as a “no deal Brexit” could send this market lower. There are a lot of problems when it comes to the British pound, but it still looks as if we are trying to go higher.

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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