GBP/JPY Forecast May 26, 2017, Technical Analysis

The GBP/JPY pair continues to show volatility during the Tuesday session, as we broke higher initially, but ran into resistance again at the 145.50 level. We then fell significantly from there, reaching towards the lows of the day before finding support again. Ultimately, I think this market is going to be difficult to trade for anything more than a quick scalp or 2, and that being the case it’s almost impossible to hang onto a trade for any real length of time, least not until we break out to a fresh, new high. It seems as if there is a significant barrier at the 145.50 level, so breaking above there could give me a little bit more confidence.
Bullishness overall
That being said, looking at the last couple of weeks we have tried to press higher, so I think they we could get the bullish pressure needed to breakout, but right now I don’t think that this market is worth trying to hang onto until it proves itself. After all, longer-term, we still see plenty of bearish pressure on the weekly and monthly charge. That being said, recently the yen related pairs have rallied, and we could be seeing a change in the overall trend but it is always a mess initially, until it becomes obvious enough for even the longer-term players to switch their positions to the upside. With this, I would expect a lot of choppiness and consolidation between the 144.50 level on the bottom, and the 145.50 level on the top. Short-term charts will continue to lead the way, but I would also ask that you keep your position sizing small until we can get a significant break in the action as volatility will continue to hinge on several factors, not the least of which will be geopolitical headlines.