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GBP/JPY Price Forecast – The British Pound Gives Up Early Gains

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·2-min read
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British Pound vs Japanese Yen Technical Analysis

The British pound initially rallied against the Japanese yen during the trading session on Thursday but gave back gains near the ¥160 level, an area that has been important multiple times. It is worth noting that we have given up almost all of the gains for the day by the time we got to New York, so unless something drastic happens, it is very likely that this pair will continue its downward pressure.

The ¥157.50 level offers a certain amount of support, but it is probably minor at best considering that we just broke through it. If we breakdown through there, then the 200 Day EMA comes into the picture. Keep in mind that this pair is highly sensitive to risk appetite, which is something that has been falling apart. As long as that is the case, we may see the Japanese yen act more as its traditional role in the markets, a safe haven.

The ¥155 level underneath is going to be a major barrier, and breaking below that could kick off even more devastation in this pair. As you can see, there was a head and shoulders pattern above that has been broken through, and almost fulfilled as far as a target is concerned. Expect significant volatility going forward, especially in this pair as it tends to be volatile under the best circumstances anyway. I like the idea of fading short-term rallies, but do not necessarily think that selling on breakdowns would be a bad idea either. It looks like the momentum is starting to shift quite drastically in this market, which is yet another sign that there is a lot of fear out there.

GBP/JPY Price Forecast Video 20.05.22

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This article was originally posted on FX Empire

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