GBP/JPY Forecast October 26, 2017, Technical Analysis

The British pound skyrocketed against the Japanese yen after a higher than anticipated CPI figure coming out of Great Britain put the British pound into overdrive. It looks as if the 150 handle should now offer support, as it was previous resistance. I think that given enough time, the market should go looking towards the 152.50 level, an area that has seen a significant amount of interest in the past. Because of this, I think that the market will continue to attract buyers as we reach towards the 150 handle. If we get those pullbacks, those should be buying opportunities and based upon the clear breakout that we have had, I think there will be a lot of traders out there looking to get involved in the market, for a fear of losing out on the overall uptrend that we should see.
I believe there is a significant amount of support down at the 149 level as well, so I think this is going to be more of a “zone” more than anything else. I continue to buy dips, and I think that the uptrend should continue going forward. It’s likely that the Bank of England will raise interest rates relatively soon, and of course of the same time we have the Bank of Japan being as loose as they possibly can be. Longer-term, I recognize that the market will continue to show signs of volatility, but those should be thought of as potential buying opportunities. After all, this market is known for its choppiness, but it also can lead to significant profits with this type of extreme swings in price. Longer-term, I think we’re going to at least go to the 155 handle, perhaps even the 160 handle over the longer-term move.