GBP/JPY Weekly Price Forecast – British Pound Resilient Against Yen

The British pound rallied during the week, breaking above the ¥132 level in a sign of strength. However, there is a lot of noise between here and the ¥135 level, so I think it is only a matter of time before we see some type of pushback. Keep in mind that the market has faced a lot of support underneath in order to bounce yet again. However, the most recent bounce before the one we are in now is lower, so that does suggest that perhaps there is still a lot of shorting going on out there.

GBP/JPY Video 01.06.20

The market has been rather tight as of late, so at this point I think we are waiting for a large impulsive candlestick in order to take some type of trade on. At this point, I believe that simply waiting to see where the risk in the world is will tell you what this pair should do. Quite frankly, I believe that the Japanese yen is considered to be “safer” than the British pound because not only do we have global issues, but we also have to worry about the Brexit which is not going anywhere, and we do in fact have to get through a slew of headlines that could cause major issues in that scenario.

With that in mind, I think it is more than likely going to be a scenario where we get a lot of choppy volatility, but I think the road higher is going to be difficult to achieve. A break above the ¥135 level could get this market moving to the upside quite quickly though.

For a look at all of today’s economic events, check out our economic calendar.

GBP/JPY Price Forecast – British Pound Continues Consolidation Against Yen

The British pound has initially pulled back during the trading session on Friday but has seen buying come in and push the market towards the top of the short-term range again. At this point though, the market still sees a lot of noise in general, so I do think that we are likely to see choppy trading back and forth. The 50 day EMA is sitting just above, and therefore it should be paid attention to. If the market were to break above there, the likelihood of a move towards ¥135 increases drastically. On the other hand, if the market were to break down below the ¥132 level again, one would have to think that the overall trend would come back into play, suggesting that we are going to go lower.

GBP/JPY Video 01.06.20

Having said that, there seems to be a lot of hope out there that as economies around the world open up, there should be an opportunity to pick up profits in general and therefore it should be more “risk on” that it has been. Perhaps the idea is that we had oversold everything to do with risk appetite, and therefore it makes sense that this pair pops. Ultimately, the market is at a major decision area, and therefore we should see some type of bigger move coming, so next week will be crucial. The 50 day EMA of course is an area that should cause some kind of barrier, so breaking above there will attract a lot of momentum traders.

For a look at all of today’s economic events, check out our economic calendar.

GBP/JPY Price Forecast – British Pound Continues to Hug Major Figure Against Yen

The British pound has gone back and forth around the ¥132 level against the Japanese yen during trading on Thursday, as we got a slew of economic numbers out of the United States, none of which of course were good. That being said, Wall Street celebrates these poor numbers as it has for a while, driving stocks higher. This has kept risk sensitive pair is a bit levitated, and that is part of what we have seen here.

That is a bit of a conundrum for markets, because some people are paying attention to the potential opening up of economies and therefore the “risk on trade”, while other people are focusing on the fact that the future may not be as bright as those other people think. At this point, if the market breaks down below the lows of the trading session on Thursday it is highly likely to go looking towards ¥131, and then eventually the ¥130 level.

GBP/JPY Video 29.05.20

To the upside, the 50 day EMA will more than likely cause a lot of resistance so as long as we can stay below that read moving average on the daily chart, I do believe that there are plenty of sellers out there willing to push to the downside. The Japanese yen of course is a safety currency and that helps, especially considering that we not only have poor economic numbers, but we also have the US/China trade situation deteriorating yet again, which of course will be good for risk appetite worldwide. At this point, the trend is still lower, so that is how we have to look at this.

For a look at all of today’s economic events, check out our economic calendar.

GBP/JPY Price Forecast – British Pound Sideways Against Yen

The British pound has gone back and forth during the trading session on Wednesday, as we continue to hang right around the ¥132.50 level. The ¥132 level underneath is a large, round, psychologically significant figure and an area that has been both supportive and resistive as of late. Keep in mind that this pair is extremely sensitive to the risk appetite of markets in general, so it will more than likely follow that overall.

GBP/JPY Video 28.05.20

Furthermore, the British pound is a currency that I do not necessarily trust, because quite frankly there are a lot of economic concerns coming out of Great Britain. There are horrific numbers as far as the pandemic is concerned, and of course the economy is completely shot. Furthermore, there is the sticking point of the Brexit still, so keep in mind that the scenario is not good for the British pound longer-term, and the 50 day EMA sitting just above has been relatively reliable as of late.

I anticipate that the market will continue to be very noisy, but clearly, we are in a downtrend from the longer-term standpoint, so it is simply a matter of waiting to see when it rolls over for us to take advantage of the shorting opportunity. If we can break down below the ¥132 level that will more than likely be the catalyst for further losses. On the other hand, if we break above the ¥133.50 level, extensively the 50 day EMA, then the market is likely to go looking towards the ¥135 level above.

For a look at all of today’s economic events, check out our economic calendar.

GBP/JPY Price Forecast – British Pound Aiming for 50 Day EMA

The British pound has rallied significantly during the trading session on Tuesday, reaching towards the ¥133 level, and perhaps more importantly from a technical analysis standpoint, the 50 day EMA. Because of this, the market looks to be a bit overdone, so I think it is only a matter of time before we rollover. The ¥132 level underneath is a major barrier, so if we were to break back down below that level, it is likely that we go much further to the downside.

GBP/JPY Video 27.05.20

On the other, if we were to break above the 50 day EMA, then it is likely that the market goes looking towards the ¥135 level the strength of the candlestick going into the New York session is rather bullish. That being said though, there is a lot of noise in this general vicinity right as I record this video, so I would fully anticipate some type of pullback.

Keep in mind that this pair will quite often break down as the Japanese yen is considered to be a safety currency if we get some type of negative headline. Quite frankly, there are plenty of potential negative headlines out there that we can see the market react to, so at this point I would be a bit cautious about going long, but if we broke above the ¥135 level, then we could see a longer-term “buy-and-hold” type of process. I think at this point it seems to be very unlikely that everything turns around that quickly and we simply shoot straight to the moon.

For a look at all of today’s economic events, check out our economic calendar.

GBP/JPY Head & Shoulders Pattern Aims at 134.50 Target

Dear traders, the GBP/JPY has bounced at the 61.8% Fib and 21 ema zone. This could indicate a bullish ABC (purple) pattern.

4 hour chart

GBP/JPY 4 hour chart

The GBP/JPY seems to have completed an inverted head and shoulders (purple boxes) reversal chart pattern. Price could aim for the Fibonacci confluence zones. One target zone is around 133.25 with a 61.8% Fib and -27.2% target. The second zone is at +/- 134.50 with 78.6% Fib and -61.8% Fib target.

Price will need to break above the resistance trend line and long-term moving averages first to confirm swing (green check). A re break below the 21 ema could indicate a deeper retracement within wave B. A break below the 100% Fib invalidates (red x) the ABC pattern.

1 hour chart

The GBP/JPY is showing strong bullish impulsiveness, which could kick off an immediate breakout. But chances of a small pullback and return into the support zone around 131.80 remain decent. Only a break below 131.25 should worry the bulls and could indicate a deeper retracement (orange arrow and red x).

GBP/JPY 1 hour chart

 

Good trading,

Chris Svorcik

The analysis has been done with the indicators and template from the SWAT method (simple wave analysis and trading). For more daily technical and wave analysis and updates, sign-up up to our newsletter

For a look at all of today’s economic events, check out our economic calendar.

 

GBP/JPY Price Forecast – British Pound Quiet on Memorial Day against Yen

The British pound gapped slightly higher against the Japanese yen to kick off the day in Asia, but with multiple countries around the world, including the United States and the United Kingdom, having holidays, the markets did truly little. That being said, we can look at this market and see that the ¥132 level is an area that has offered significant resistance and has offered significant support previously. Because of this, it is likely that the market is going to continue to respect that is the top of the range, and I will be looking to sell this pair if we get anywhere near there. If we break down below the ¥131 level significantly, then it opens up a move down to the ¥130 level, followed very quickly by the ¥129 level.

GBP/JPY Video 26.05.20

Keep in mind that this pair is extremely sensitive to risk appetite, which of course is all over the place right now. But when you look at the longer-term chart, it is obvious that we are clearly drafting lower over time, even though we are at historically low levels. Quite frankly, the United Kingdom has an absolute mess on its hands when it comes to the economy and the Brexit, so there are a lot of moving pieces that could come in and work against the value of the British pound itself. Beyond that, we could also be looking at headlines crossing the wires from a global sense that causes a lot of issues as well. If that is going to be the case, then it makes sense that the Japanese yen would be bought.

For a look at all of today’s economic events, check out our economic calendar.

GBP/JPY Weekly Price Forecast – British Pound Continues Tight Range Against Japanese Yen

The British pound rallied significantly during the week, but then gave back the gains rather quickly at the ¥132 level. The weekly chart looks very noisy down here, as we are at extreme lows. Ultimately, this is a market that is going to continue to see noise due to the fact that the area just below the ¥129 level has been fought over so drastically. I believe at this point it is likely we will continue to see traders try to build up a little bit of momentum in this area, but if we were to break down below it is likely that we will then flush lower, perhaps all the way down to the ¥125 level.

GBP/JPY Video 25.05.20

To the upside, if we can take out the ¥132 level it is likely that we could go looking towards ¥135 level where I would see even more resistance and would be much more willing to start shorting. With all of this noise, it is difficult to trade from a longer-term charts, but one would have to favor the downside in general due to the fact that the risk appetite out there should continue to cause issues. At this point, fading rallies should continue to offer opportunities, and therefore it is likely that we will see selling pressure every time it gets ahead of itself. Ultimately though, longer-term traders are probably better served looking at shorter-term charts when it comes to trading this particular pair and in this particular environment.

GBP/JPY Price Forecast – British Pound Rolls Over Against Yen

The British pound has initially tried to rally during the trading session on Friday but found the ¥132 level quite resilient as far as selling is concerned, and we have drifted lower from there. Ultimately, this is a market that I think will start looking towards the ¥130 level underneath, possibly even the ¥129 level. Because of this, the market is continuing to “sell the rallies”, which makes quite a bit of sense considering how many negative headlines there are out there just waiting to cause issues. After all, the Japanese yen is considered to be a “safety currency”, so this pair tends to continue falling if there is a lot of negativity out there. I do believe that is going to continue to be the case, so therefore I like the idea of fading short-term rallies every time we get an opportunity to.

GBP/JPY Video 25.05.20

If we can break down below the lows underneath, somewhere closer to the ¥129 level, it is likely that we could go to the ¥127.50 level, possibly even down to the ¥125 level. To the upside, if we were to see the 50 day EMA be tested, that should be a massive amount of resistance as well but obviously that would take a pretty significant move to the upside to make it happen. With that in mind, it is crucial that you keep your position size relatively small but look at rallies as opportunities to pick up the Japanese yen “on the cheap.”

 

GBP/JPY Price Forecast – British Pound Continues Choppy Behavior

The British pound has gone back and forth during the trading session on Thursday, considering the ¥132 level to be important. At this point, it looks like the market is likely to continue to see noise in this general vicinity, but at this point it looks as if the ¥132 level is going to continue to be quite difficult to break above. We have shot above there during the previous couple of candlesticks, but you will see that the market gave up the gains. I think this is going to continue to be a very noisy trading area, as this pair typically is and of course is overly sensitive to the idea of risk appetite.

GBP/JPY Video 22.05.20

To the downside, I suspect that the ¥130 level could cause some support, and if we break down below there it is likely that the market continues to go to the downside. Breaking down to a fresh, new low will clearly add more pressure in this market to go down towards the ¥125 over the longer term, with perhaps some minor support at the ¥127.50 level. With this being the case, I would anticipate that the market is likely to be exceedingly difficult to manage from a short-term prospect, so keep your position size relatively small and hang on to the downside. As far as buying is concerned, I would need to see this pair break above the 50 day EMA which is painted in red on the chart. If that is going to be the case, then I would consider a run towards the ¥135 level highly likely.

GBP/JPY Price Forecast – British Pound Continues to Test Same Area

The British pound has gone back and forth during the trading session on Wednesday, as we dance around the crucial ¥132 level. This is an area that previously had been significant support, so it should now be resistance, at least in theory. We did see that during the trading session on Tuesday, so the question is whether or not it can hold? At this point, it looks like it may be able to do to the fact that the range going into this is relatively short, but ultimately this is a market that is getting a bit extended, so if it is going to break back down, this is probably an excellent area to see that.

GBP/JPY Video 21.05.20

If we do break above here, then the question is whether or not we can break above the 50 day EMA? I think that could also cause a significant amount of resistance and therefore I like the idea of fading out there as well. I really do not have any interest in trying to buy this market, because quite frankly this is a set up that is a little bit “too perfect” for short sellers. Furthermore, the Japanese yen is a safety currency and we are most decidedly in a downtrend. Whether or not we break down is a completely different question, but I do know that there is only one direction that I would be trading this pair.

Market Caution Returns on Vaccine Doubts

Healthcare news website Stat published a report on Moderna Inc, indicating that the American biotech company provided insufficient data. Such a development has raised doubts over the efficiency of a potential vaccine and this negative sentiment continues to be reflected across global stocks.

A darker mood certainly awaits financial markets as concerns revolving around the vaccine compound with global growth fears and renewed US-China trade tensions.

Yen positioned to gain on risk aversion

Expect the Japanese Yen to appreciate against G10 currencies if risk aversion makes a full-blown return.

Looking at the technicals, the USDJPY remains in a wide range on the daily charts with resistance at 108.00 and support at 106.60. An appreciating Yen may encourage a decline back towards 106.60 and 106.00, respectively.

Alternatively, a breakout above 108.00 could swing open the doors towards 109.00.

EURJPY eyes 118.50 resistance level

The EURJPY is in the process of a technical rebound with prices heading towards the 118.50 resistance level.

A solid breakout above this point may trigger a move higher towards 119.00 before sellers re-enter the scene. Given how the fundamentals are in favour of the Japanese Yen, the long-term outlook for the EURJPY points south.

If 118.50 proves to be reliable resistance, prices could sink back towards 117.00.

GBPJPY breakout setup still in play

It has been the same story with the GBPJPY as the currency pair trends within a wide range. All eyes will be on the support at 129.50 and resistance at 135.50.

The fundamentals moving the GBPJPY revolve around Brexit uncertainty, slowing global growth and risk aversion among many other themes.

A decisive breakdown and daily close above 133.00 should pave a path towards 135.50. Alternatively, if 133.00 proves to be reliable resistance, prices may move back towards 129.50.

Commodity spotlight – Gold

Gold is set to glitter this week as investors adopt a more guarded approach towards riskier assets.

The precious metal is finding comfort at levels not seen in more than seven years around $1750 and could push higher should risk-off make a full-blown return.

Focusing on the technicals, a move above $1765 could inspire an incline towards $1770.

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GBP/JPY Price Forecast – British Pound Reaches Towards 132 Yen

The British pound has rallied significantly during the trading session on Tuesday to reach towards the ¥132 level. At this point, the market is likely to see a lot of selling pressure as it was previous support. Furthermore, you have to keep in mind that the global situation is tenuous at best, and that generally favors the Japanese yen for safety. The last couple of days have been a bit over-the-top, mainly based upon the potential of an eight person study to bring some type of vaccine to the world. Even if that were the case, it is probably at least two years away, and from a historical standpoint four years is probably a little closer to the reality.

GBP/JPY Video 20.05.20

Regardless, there is a lot of noise above and therefore I would be fading short-term rallies and recognize that we will probably go back towards the ¥130 level. Quite frankly, we would need to clear the ¥135 level to be in the “all clear” for buying from a longer-term standpoint, so I certainly believe that it is only a matter of time before we get an opportunity to get short again. You will probably notice this on short-term charts, but I do recognize that it is only a matter of time before we get yet another headline to throw the markets around. That is the nature of things recently, so by all means make sure that your position size is reasonable and of course your stop losses are in place.

GBP/JPY Price Forecast – British Pound Rallies to Kickoff Week

The British pound has rallied significantly against the Japanese yen during the trading session on Monday, reaching towards the ¥131 level. The market broke down on Friday, and now it is testing whether or not that breakdown with legitimate. Quite frankly, with all of the “fear of missing out” that we are seeing in the United States, it is hard to tell. Having said that, we are still most certainly in a downtrend, so I like fading signs of exhaustion. We do not have it yet, but you may look to short-term charts in order to start scaling into the downside. After all, this is a risk sensitive pair, and clearly risk appetite, although extraordinarily strong to kick off the week, is struggling in general.

GBP/JPY Video 19.05.20

Furthermore, the British economy has a lot of issues surrounding it, not the least of which is going to be Brexit issues, and then of course the fact that the coronavirus numbers in the United Kingdom have been much worse than most other countries. With that, I believe that the British pound will roll over eventually, but in the short term it looks like it still has enough resiliency to keep trying to grind to the upside. I will wait for a bearish or exhaustive daily candlestick to place a trade, because this pair is extraordinarily sensitive to risk appetite and “FOMO”, something that is a real problem and bear markets when you get the occasional bounce. That being said, the market is most decidedly going from the upper left to the lower right, and that is the most important thing to worry about.

GBP/JPY Weekly Price Forecast – British Pound Breaks Down Towards Major Level

The British pound initially tried to rally during the week but gave back the gains to slice through the bottom of the hammer from the previous week. This of course is an extremely negative sign, and as we are testing the ¥130 level, it is likely that if we can break down below there it will signal fresh selling, perhaps a run down to the ¥127.50 level, possibly even the ¥125 level. Looking at this chart, it certainly has been in a downtrend for some time, but this recent bounce has caught a lot of people off guard. You should also keep in mind that the markets around the world have shown a decidedly “risk off” type of attitude of the week, so this moves right along with it.

GBP/JPY Video 18.05.20

On the other hand, if we turn around a break above the €132 level, then you have to reassess the longer-term move and potential trend. At this point in time though, it looks like we are decidedly negative and quite frankly probably should be considering how expose the United Kingdom is to the coronavirus, we have the Brexit to worry about, and of course the Japanese yen is a safety currency in a time of extreme negativity. It looks likely to be a continuation that we are looking at. However, do what the markets tell you and of course be aware the fact that the headlines continue to cause massive volatility.

GBP/JPY Price Forecast – British Pound Dropped a Bit Against Yen

The British pound has initially tried to rally during the trading session on Friday but gave back the gains, as we broke down below the bottom of the hammer from the previous session, before finding buying again. That being said, the market is struggling to break down through there on a sustained basis so it is highly likely that this market will end up being somewhat range bound. The ¥130 level seems to be offering a bit of support, but if that level gets broken through decidedly, then the market could drop rather quickly. Remember, this is a very risk sensitive currency pair, so as the markets go in general, so does the GBP/JPY pair.

GBP/JPY Video 18.05.20

The ¥132 level above is probably going to be significant resistance as well, as it was previous support. The market looks highly likely to go looking towards the ¥127.50 level, and then the ¥125 level given enough time. Overall, this is a market that continues to be noisy, but I would also suspect that the market is likely to fade rallies every time they happen, as the market looks likely to be susceptible to gravity. For what it is worth, the retail sales in the United States were much worse than anticipated, so that should favor the downside when it comes to risk assets. That of course will continue to be the case, as it is obvious that the markets have a lot to worry about currently. Fading rallies will continue to work out.

GBP/JPY Price Forecast – British Pound Drifts Lower Against Japanese Yen

The British pound has drifted lower against the Japanese yen again during the day on Thursday, as we continue to see a lot of fears around the world when it comes to global growth and of course the virus situation. This is an obvious sign of “risk off” behavior, and therefore should continue as the downtrend has started to pick up again. Ultimately, this is a market that will continue to weigh risk appetite overall and reflect that risk in the price. The Japanese yen is considered to be a “safety currency”, so therefore it makes sense that traders would start reaching towards it and away from the British pound as not only is the Japanese yen a sign of safety but the British pound has a whole host of issues to worry about.

GBP/JPY Video 15.05.20

As the United Kingdom is locked down and just now starting to open up a bit, Japan has essentially been wide open the entire time. The infection rate in Japan is almost nothing, while the infection rate in the United Kingdom has been quite strong. Furthermore, there have been a lot of concerns about future problems in Great Britain, not the least of which will be Brexit. With that in mind, it makes quite a bit of sense that we will see this pair continue to drift lower over the longer term.

At this point, I anticipate that the ¥132 level will continue to offer resistance as we have seen of the last couple of days, being the previous support level. Ultimately, this is a pair that I do think will continue to look towards the lows and given enough time may very well reach them.

GBP/JPY Price Forecast – British Pound Runs Into Resistance Again

The British pound has rallied a bit during the trading session against the Japanese yen on Wednesday but continues to find a lot of interest near the ¥132 level. That is an area that was previous support and should now be resistance. So far, it does seem as if it is going to offer the resistance that one would expect, so therefore selling this pair does seem to be the way to go going forward. The ¥130 level underneath should be supported, and if we can break down below there then the market should go much lower.

GBP/JPY Video 14.05.20

At this point, you should keep in mind that the pair is overly sensitive, especially when it comes to all things risk related. The Japanese yen is considered the safety currency in this pair, so as people become more and more concerned about the global economy, this pair should continue to tumble. To the downside, if we break down below the ¥130 level then it is likely that we go looking towards the ¥127.50 level. The ¥133.50 level above has offered significant resistance as of late, and therefore if we were to break above there then we will probably reach towards the 50 day EMA which is just above there as well. One thing is for sure, the market looks as if it is running out of momentum to the upside in general, so having said that it is likely that the downside is going to be much more preferred.

GBP/JPY Price Forecast – British Pound Continues to Fight Against Japanese Yen

The British pound formed a bit of a bullish candlestick early in the day on Tuesday, as the market bounced from the ¥132 level. By doing so, it shows signs of life yet again, as the market has been stubbornly bullish. That being said though, it comes down to risk appetite in general as the pair is overly sensitive to that. At this point, if the market breaks down below the ¥132 level, it would be a wipeout of the Tuesday candlestick which of course would be extremely negative. At that point it could very well send this market down to the ¥130 level, perhaps even the ¥127.50 area.

GBP/JPY Video 13.05.20

To the upside, the 50 day EMA is sitting around the ¥134.50 level, and it is likely that the level will come into play if we do rally. Regardless, we are still very much in a downtrend, so I am looking for reason to sell this market. The question is whether or not we break down below this candlestick and continue the downtrend or do we try to rally a bit in order to find selling pressure above that we can take advantage of, not to mention exhaustion. That being said, it should be noted that if we break above the ¥136 level, that would be an extraordinarily bullish sign, but we are at the very minimum days away from something like that happening. This market should continue to attract sellers in general, and therefore I remain bearish on the whole.

GBP/JPY Pullback Reaches 144 ema and 50% Fibonacci Resistance

Dear traders, the GBP/JPY made a bullish pullback after a strong downtrend (red candles). The bears could soon regain control again and aim for the 130 target.

4 hour chart

GBP/JPY 4 hour chart

The GBP/JPY pullback reached the 50% Fibonacci and 144 ema resistance confluence, which could end the pullback. A breakout below the support trend lines (green) and the 21 ema zone would confirm the downtrend (orange arrows and green check)).

The first target is the Wizz 7 level at 130.80 but an extension towards the Wizz 8 target at 130 is likely too. Once price breaks below the 21 ema zone, price should stay under it. A re-break above the 21 ema zone and 144 ema could invalidate (red x) the bearish outlook.

Good trading,

Chris Svorcik

The analysis has been done with the indicators and template from the SWAT method (simple wave analysis and trading). For more daily technical and wave analysis and updates, sign-up up to our newsletter