GBP/JPY Price Forecast March 5, 2018, Technical Analysis

GBP/JPY traders sold during the trading session on Friday again, reaching down towards the 145 handle. That’s a level that should be rather supportive, but it should be pointed out that we have broken down through a major uptrend line on the longer-term charts during the week, so I think we will probably try to break down below 145 eventually. · FX Empire

Christopher Lewis

Updated Fri, Mar 2, 2018, 9:12 PM

The British pound has fallen during the trading session on Friday, reaching down to the 145 handle again. This is an area that should obviously cause some type of psychological support, but I would be remiss if I didn’t point out that we have broken down below the uptrend line that had kept this market higher for so long. The fact that we broke down through that support line is a very negative sign, and I think that we will probably continue to go lower and breakdown below the 145 handle.

Breaking down below the 145 handle would be the market opening the door to the 143 handle, and then eventually the 140 handle. Keep in mind that this pair is very risk sensitive, so it will be interesting to see how the world reacts to the tariffs in the United States. That could put a lot of volatility into the markets, and that typically favors a lower move. For what it’s worth, the US dollar has fallen towards the 105 level against the Japanese yen, a major support barrier. If that market breaks down below that level, this pair will certainly follow and go even lower than that pair will as usual. If we do rally, it’s not until we break above the 148 level that I would be comfortable going long. At that point, we will have obviously cleared a major resistance barrier in the most recent high.