GBP/JPY Price Forecast February 27, 2018, Technical Analysis

The British pound gapped higher at the open on Monday, but then pulled back to fill that gap as we often will. We found plenty of buyers, and then reach towards the initial resistance barrier in the form of the 150 handle. The level of course will attract a lot of attention, as 150 is a large, round, psychologically significant level. I think that the market will continue to respect this area, and I believe that it will continue to cause a lot of noise. However, I think that we are trying to form some type of base overall, and I think that given enough time we will break above the 150 level and continue to go much higher. In the meantime, I think that the buyers underneath will continue to look at dips as value, and I think there is plenty of support near the 149 handle.

The 151 level above is resistive, so if we can clear that level I think that the market will continue to go much higher. Ultimately, at that point it could become more of a “buy-and-hold” scenario, as we will have plenty of momentum build up after the inertia that would be taken to break above there. If we can get that, I think that we will go towards the 160 handle over the longer term. If we were to break down below the 148.50 level, the market will probably go looking towards the 105-level underneath, where I see even more support.

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