GBP/JPY Weekly Price Forecast – British pound pulls back for the week

The British pound pulled back a bit during the week, pulling back from the ¥145 level. The British pound has gotten a bit soft over the week but when looked at in the course of the last month or so, you can see that this is a simple retracement. I think that the British pound is trying to form a bottom, and perhaps about a month ago we had seen that thing form near the ¥140 level. That being said, we are still in the down trending channel so that is not confirmed for a longer-term “buy-and-hold” trade yet.

GBP/JPY  Video 04.02.19

As it looks like there is high likelihood of a delay in the Brexit situation, and perhaps signs of cooperation, that should push the British pound higher given enough time. At the same time though, the European suggest that there are no possibilities of renegotiating the deal, so then the onerous falls on Great Britain. Looking at the charts, I think that this could be a choppy bottoming pattern trying to form but those things typically take a lot of time. What we need is some type of agreement for the Brexit, and of course more of a global “risk on” attitude to help this market. Expect a lot of volatility, but I do think that longer-term we are going to see this market go much higher. I believe that the ¥140 level is the beginning of massive support where we have tried to lift. That being said, I would keep my positions small, because quite frankly I expect a rough couple of weeks ahead.

This article was originally posted on FX Empire

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