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GBP/JPY Price Forecast – The British Pound Continues to Fight Weakness

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British Pound vs Japanese Yen Technical Analysis

The British pound initially pulled back during the trading session on Monday but then turned around to show signs of life again. Breaking all the way up to the ¥159 level by the time New York got involved. The ¥160 level above continues to offer a bit of resistance if we do get there, as it is a large, round, psychologically significant figure. Furthermore, the area had previously been supported, so therefore it should continue to have a bit of “market memory” attached to it.

If we do break down below the lows of the session on Monday, we would be a clearance of the one ¥57.50 level to the downside, opening up the possibility of a move to the 200 Day EMA. Below there, then we have the ¥150 level. Ultimately, this is a market that continues to be very volatile, but that is typical for this pair as it is so sensitive to risk appetite. Obviously, the risk appetite has been all over the place over the last several weeks, so therefore it does make quite a bit of sense that we have seen this type of action. Currently, I look at this as a market that is trying to bounce around between the 50 Day EMA above and the 200 Day EMA underneath. That typically means that we are going to see a lot of volatility, which is exactly what has happened

Looking at this chart, I will be paying close attention to these moving averages, and of course other markets in the world. If stock markets get sold off, it is very likely that the Japanese yen will continue to pick up a bit of strength. It is also worth noting that we had previously formed a massive head and shoulders pattern that a lot of traders will be paying attention to.

GBP/JPY Price Forecast Video 17.05.22

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This article was originally posted on FX Empire


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