GBP/JPY Price Forecast February 12, 2018, Technical Analysis

The British pound has fallen rather hard during the trading session on Friday, reaching down towards the 150 level. This is an area that should be supportive, but as we have been so aggressive to the downside, I suspect that it is probably best to let this market stabilize before putting money to work, but the 150 level is of course a large, round, psychologically significant number. If we can bounce from here, we could see this market rally back towards the 153 handle, and then eventually the 155 level.

Pay attention to risk sentiment around the world, as this pair tends to be very sensitive to it. If stock markets can recover, that should be good for this market, but if they start to sell off yet again, then this pair will most certainly drop. It’s not a perfect correlation, but it seems that if the S&P 500 can do well, so can this pair.

I believe that the 147.50 level underneath is massively supportive, so we do break down from here it’s probably going to be a short-term move at best. I don’t feel very comfortable shorting though, so what I need to see is some type of bounce to put money to work. I suspect it would be very noisy on the way up, but it goes with the longer-term trend that we’ve seen for the last year or so.

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