GBP/JPY Price Forecast – British Pound Choppy Against Yen

The British pound has been all over the place during the trading session on Friday against the Japanese yen which makes quite a bit of sense considering how much risk appetite is going back and forth around the world. Keep in mind that the pair tends to be very sensitive to risk appetite, so this of course has a lot to say at times. The market falling to the ¥135 level suggests that there was a lot of fear earlier in the session but bouncing as hard as we have from there is a good sign, at least in theory.

GBP/JPY Video 05.10.20

The ¥137 level above is extreme resistance, so if we were to break above there then we could have a nice countertrend rally. On the other hand, if we break down below the ¥135 level, it is likely that we go looking towards the ¥133 level. All things being equal, I think that we stay in this 200 point range for the short term, but a move is most certainly coming soon. Brexit will be one of the main drivers, but there is a lot of instability out there that you need to be aware of.

Ultimately, that could put downward pressure on this pair. With that being said, I would look for short-term selling opportunities if they appear. Otherwise, I will be a buyer until we break above the highs of the Thursday session on a daily close. There is simply far too much risk out there right now, so regardless of which you choose to do in this market I would use a very small position.

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