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GBP/JPY Price forecast for the week of February 19, 2018, Technical Analysis

Christopher Lewis
Updated
The British pound has fallen a bit during the week, but as you can see we have bounced from the uptrend line on the weekly chart. As you can see, I think that the market is ready to continue to go higher, and on a move above the 150 level, we may have something going.

The British pound has broken down below the 150 level during the week, but as you can see the uptrend line has held true. Because of this, I think that the market is ready to bounce, in a move above the 150 level would have me buying again, perhaps aiming towards the 155 level in the intermediate. I believe that if we can break above there, the market then goes to the 163 handle, which has been resistance in the past. Alternately, if we manage to break down below the uptrend line, the market should continue to go down to the 145 handle, and then perhaps the 140 level.

Remember that this pair tends to be very highly motivated and influenced by the overall risk appetite of the markets, so it makes sense that you should pay attention to stock markets, and of course commodity markets. If they rally, typically that will send this pair higher, as the correlation is strong over the longer term. We have seen a lot of support though, so I think that it’s only a matter of time before the buyers come in to pick up value. Longer-term, I suspect that we will not only go to the 163 handle, and then eventually the 170 level after that. Ultimately, if we break down, that needs to coincide with a selloff in the stock markets, which would show a bit of a “risk off” attitude.

GBP/JPY Video 19.02.18

This article was originally posted on FX Empire

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