GBP/JPY Forecast May 3, 2017, Technical Analysis

The GBP/JPY pair continues to see bullish pressure during the Tuesday session, as we reached towards the 145 handle. A break above there happened early in the day, but we did see enough resistance to turn things around slightly. I still believe in the bullish pressure and the buying opportunity, especially on dips. The 24-hour moving average underneath continues to offer support, and I believe that dips will offer value that we can take advantage of. A break above the recent high should send this market towards the 146 handle next. A break above there should send this market much higher, perhaps reaching towards the 150 level.
I don’t have any interest in selling this pair, unless there is a general “risk off” attitude in the markets overall. If the stock markets around the world start selling off, then this market will do the same. A breakdown below the 72-hour moving average, pictured in blue on the chart, would be a very bearish sign in at that point I would have to think that a longer-term pullback is coming. Nonetheless, the British pound has broken out to the upside for a longer-term move against all currencies that I see, so I don’t understand that the Japanese yen would be any different. I believe that longer-term this offers quite a bit in the way of opportunity, but you’re going to be dealing with a significant amount of volatility on the way to the upside. Pay attention to the S&P 500, the FTSE 100, and of course the Nikkei 225 as they all represent a good look at global risk appetite. Bonds falling tend to help this pair as well, as it shows more risk appetite. Expect choppy conditions, but I still believe in the bullish picture.
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