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GBP/JPY Weekly Price Forecast – British Pound Plunges Towards Major Support Level

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  • GBPJPY=X
  • JPY=X
  • GBP=X

The British pound has fallen a bit during the course of the trading week, to reach down towards the ¥150 level. There is a significant amount of support that extends down to the ¥149 level, and therefore I think if we were to break down through there, the market then falls apart. Below the ¥149 level is likely to open up the possibility of a move down to the ¥145 level. That is where the 200 week EMA sits, and of course that would be a 500 PIP move. In that scenario, we would be looking at a major “risk off” type of situation.

GBP/JPY Video 06.12.21

On the other hand, if we turn around and show signs of life, then the market is likely to go looking towards the ¥152 level, perhaps even the ¥152.50 level. One thing is for sure, we are seeing a lot of volatility now in this area, so at this point in time it is likely that something needs to give. Quite often, when you see extreme volatility like we have over the last couple months, you are about to see a big move.

As we are heading towards the end of the year, it does make a certain amount of sense that the choppy behavior continues regardless, but if we break down below that ¥149 level, all hell could break loose. On the other hand, if we stay in this range between ¥150 and ¥155, we will have a simple range bound set up. As things stand right now, it is roughly a 50-50 shot as to which direction we go. Let the market tell you where it wants to head, and simply follow.

For a look at all of today’s economic events, check out our economic calendar.

This article was originally posted on FX Empire

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