GBP/JPY Forecast October 17, 2017, Technical Analysis

The British pound slipped a bit during the day on Monday against the Japanese yen, but when you look at the overall attitude of the market, we have been rallying for several days. These pullbacks continue to find buyers, and I think that they will return rather soon. The 148 level looks to be supportive, and I think we will probably continue to reach towards the 149 handle after that. Longer-term, I think the real target is the 150 handle, as it is a large, round, psychologically significant number. A break above that level should send this market to much higher levels. I suspect that this is going to be a back and forth with slightly positive momentum. I think that the “back and fill” action should continue, and that short-term traders will continue to buy on the dips.
The market of course is highly sensitive to risk appetite around the world, so pay attention to stock markets. If they rally, then typically this pair will as well. There is no stock market that influences this market more than anything else, but I think the overall attitude is what you should be paying attention to. If the stock markets continue to find reasons to go higher, I think that we will eventually break above the 150 handle, but it’s going to take quite a bit of building to do so. Once we break above there, my next target is the 152.50 level. If we were to fall from here, I think that the 147 level will offer support again, but a breakdown below there would be very negative and have this market looking towards the 145 handle. The only thing that I think you can count on is going to be massive amounts of volatility.

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