GBP/JPY Forecast October 4, 2017, Technical Analysis

The GBP/JPY pair initially tried to rally on Tuesday but found enough resistance above the 150 level to turn things around and drop significantly. However, I think that there is a certain amount of support near the 149.50 level the keeps the market somewhat afloat. I think at this point, it’s likely that we will continue to go sideways, perhaps trying to bounce around the 150 level. Given enough time, the market probably rallies from here, and if we can break above the 150.33 level, then I think that the market can continue to go towards the 151.50 level above. Pullbacks of this point should continue to be buying opportunities, but if we break down significantly, then I think the next support level will be closer to the 140.50 level.
Volatility will continue due to the risk sensitivity of this currency pair, and the overall attitude. I think that there are nice buying opportunities in this market, but you will have to be able to deal with choppiness. Once we break out to the 150.33 level, then I think that you will see more of a rush into the market as it could give us an opportunity to pick up a nice move higher. The market should then go looking towards the 151.50 level, and then eventually the 152.50 level. I think that given enough time, the market will show a proclivity to follow the S&P 500 and other stock markets, as is typically the case with this market. If we do break down, I think that simply waiting for support to start buying again is probably the best way to go. If we were to break down below 140.50 though, that changes everything and I think we fall drastically from there.