GBP/JPY Weekly Price Forecast – Pound Continues to Test Same Level

The British pound has broken down during the course of the week, slicing down through the ¥135 level during the week, but then turned around to show signs of life again. The ¥135 level has been important multiple times, and as a result it looks like we are trying to hang on to some last vestige of an uptrend. At this point, I focus on the hammer from a month ago showing signs of support here. With that in mind, the market is looking at this area as important, so therefore we need to think of it as such. If we break down below that hammer, the bottom is going to fall out of this pair.

GBP/JPY Video 02.11.20

If we can break above the top of the candlestick from earlier this month, then the market is probably going to go reaching towards the ¥140 level. That means breaking above the ¥138 level on the way. If we can break above there, then we will go looking towards the 200 weekly EMA. All things being equal though, this is a pair that looks like it is going to grind back and forth and it probably should, due to the fact that the market is likely to see a lot of uncertainty in general, and this is a pair that is going to be very sensitive to all of that. With that being the case, and of course the nonsense going on with Brexit, I find it very difficult to believe that we are going to get a sudden move. Choppy sideways trading is probably the most likely outcome.

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