GBP/JPY Price Forecast January 22, 2018, Technical Analysis

The British pound fell against the Japanese yen during the day on Friday, as the Japanese yen gained against most currency. The 153-level underneath looks very likely to offer support, and if we can bounce in their it should be a nice buying opportunity. Remember, this pair tends to be very risk sensitive, so stock markets around the world rally, that could help as well. There’s plenty of noise between 153 and 152 underneath, so I think that it will offer a bit of a “buffer” for the uptrend. The marketplace will of course be noisy, but that’s nothing new for this pair. Longer-term, I anticipate that this market is probably going to go looking for the 155 handle above, and then based upon longer-term charts, 163.

If we do break down below the 153 level, then I will need to see the market bounce back above that level to start buying. Otherwise, I would stay away from this market as it will need to make its decision. The British pound has been oversold historically for the last several years, so I think we continue to see a bit of a resurgence, especially against funding currencies such as the US dollar and the Japanese yen. That being the case, the market should continue to find plenty of reasons to go higher, especially considering that the breakout above 153 was so important on longer-term charts, being a place that had been resistive in the past as well as supportive going back years.

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