GBP/JPY Forecast September 26, 2017, Technical Analysis

The British pound rallied a bit during the day on Monday after gapping higher. We reached to the 152.25 handle, but then pulled back to fill that gap again. We have bounced from there, and it now looks as if we are going to continue the overall consolidation that we have seen in the last few days. I believe that pullbacks offer buying opportunities, especially if the stock markets continue to look healthy. Remember, this pair tends to be very significantly driven by risk appetite in general, so pay attention to how financial markets are going around the world. If they rally, typically this pair does as well.
Ultimately, another factor is that the Bank of England looks likely to raise interest rates. We know that the Bank of Japan is nowhere near doing so, so it makes sense that the market continues to go higher. I believe that pullbacks should be buying opportunities, but only after seeing substantial stability. Ultimately, this is a market that I think will go looking towards the 155 handle above, and then eventually the 160 level after that. I like this pair, as it shows extreme amounts of volatility and if you can get a supportive candle after a dip, it represents value that can greatly increase your profits. I believe that the market will continue to be held hostage to headlines that rocked the markets. I believe that the market should continue to find reasons to go higher over the longer term, so these pullbacks offer the opportunity to make substantial profits. Ultimately, this is a market that I think will find plenty of support at the 150-handle underneath, which of course has a certain amount of psychological significance to it as well. Ultimately, a breakdown below there could have this market looking towards the 140.50 level underneath which had been massively resistive.

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