GBP/JPY Price Forecast December 21, 2017, Technical Analysis

The British pound rallied significantly during the day on Wednesday, reaching towards the 152 handle. While I think we could pull back from here, it’s likely that pullbacks will only end up being buying opportunities as we have made a fresh high. By doing so, I think that the markets will continue to be bullish, but we also are going to run out of liquidity between now and the end of the year. I think that this is more of a “risk on” move, which typically will send this market to the upside. The real fight is near the 153 level above, where I think that a breakout above that level would be a longer-term “buy-and-hold” scenario.

I believe that the 150-level underneath is now functioning as a floor in the market, so if we can stay above there, it’s more than likely going to offer buying opportunities given enough time. Because of this, I think that the thin volume might give us the opportunity to pick up this pair at a lower level, and I would be willing to jump on those lower prices. However, I would also not be very surprised if we go sideways over the next several sessions as the market will calm down due to traders focusing more on Christmas and New Year’s than trading currencies. Longer-term, and going into 2018, I believe this market goes higher. Because of this, I’m looking at short-term pullbacks as value, nothing more nothing less as I think the markets continue to be looking for a risk on move.

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