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GBP/JPY Weekly Price Forecast – The British Pound Likely To Bounce

The British pound initially tried to rally during the week, but then broke down below the 200 week EMA. From there though, we have bounced a bit and it is showing signs of continuing to build up pressure to the upside.
Christopher Lewis
GBP/JPY Weekly Price Forecast - The British Pound Likely To Bounce

The British pound initially tried to rally during the week but then broke down after Boris Johnson suggested that the British were going to leave the European Union without asking for any type of extension. Ultimately, this is a market that is in the process of breaking out and changing its overall trend and could get a bit of a boost to risk appetite if it does in fact turn around. The US/China trade situation could have a major influence over here as well as the Japanese yen is considered to be a “safety currency.”

GBP/JPY  Video 23.12.19

Looking at this chart, we have had a significant run higher and had recently broken out of a bullish flag and it measures for a move towards the ¥150 level. Historically speaking, that isn’t that expensive, so it’s not very difficult to imagine that happening. Pullbacks at this point will continue to be buying opportunities and therefore it’s likely that the pound will continue to be bought on dips. I think that this could be a major mover for 2020 as the British leave the European Union and start to stabilize. Beyond that, if the Americans and the Chinese cool off the trade war as we head towards the election, that could give enough bullish pressure to the markets in general to keep the Japanese yen soft, thereby sending this market higher. I would build up a core position relatively slowly though, because of the massive amount of noise in the marketplace overall.

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