GBP/JPY Price Forecast March 8, 2018, Technical Analysis

The GBP/JPY pair has initially tried to rally, but then rolled over at the 147.50 level, an area that’s been resistance in the past. Because of this, I think we’re going to continue to consolidate, at least until we get some type of clarity when it comes to risk appetite around the world. There are a lot of jittery traders out there due to a potential trade war, especially with the European Union saying they are ready to retaliate against the United States. If that’s the case, it’s likely that the GBP/JPY pair will crumble. Otherwise, if we can break above the shooting star on the hourly chart that just rolled over as I record this, I think the buyers will try to test the previous uptrend line. If we can break above the previous uptrend line, and essentially the 148.50 level, the market is free to go to the 150 handle.
Alternately, if we break down below the 146 handle, the market should then go down to the 145 handle which is significant support. If you believe that we break below there, then you recognize that we probably go to the 140 handle after that. Beyond that area, it’s likely that the market will continue to fall apart and could collapse. Ultimately, I think that the volatility in this pair is going to continue to increase over the next several sessions, so I would keep my position size small regardless of which direction I was trading.

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