GBP/JPY Weekly Price Forecast – British Pound Tests Support Against Yen

The British pound has fallen during most of the week but has also corrected its losses at the ¥150 level, an area that should continue to be important. The candlestick is a bit negative, but we did see buyers step in on Friday to see this bounce occur. At this point though, the question is whether or not we need to see a larger pullback to find buyers.

GBP/JPY Video 12.04.21

The market has gotten a bit ahead of itself, but the Japanese yen been oversold has been a condition that we have seen for several months. It is not as if the trend is going to suddenly end, just that it needs some type of correction or at the very least it needs to go sideways to work off all of this insane froth. Nonetheless, you cannot be a seller, at least not anytime soon but you could make the argument that breaking below the hammer from a couple of weeks ago could open up a move down to the ¥145 level.

That is an area that I would expect to see some psychological support, but clearly the path of least resistance is to the upside, so you should keep that in mind when trying to trade this pair. After all, the Japanese yen has been pummeled against most currencies, not just the British pound. That being said, if the GBP/USD pair starts to recover, that could really put upward pressure on this pair as well, because it would then give yet another reason for this market to rally, not just based upon a week Japanese yen.

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This article was originally posted on FX Empire

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