GBP/JPY Price Forecast – British pound recovers
This pair is not only sensitive to the Brexit, but it’s also going to be sensitive to other situations such as the geopolitical concerns around the world. After all, we have a situation where the Chinese and the Americans are involved in a trade tariff war, and it’s possible that it’s only going to get worse. If that’s the case, that should drive down the overall global markets, thereby driving down risk assets, which this pair is highly sensitive to. Compound that with the potential of headlines coming from the Brexit, and it’s no big surprise that the market would struggle to hang onto gains in this environment. I think that the market will probably try to revisit the ¥147.35 level, but I wouldn’t put a lot of money based on that opinion. But frankly, I think this is a market that can turnaround on you at any given moment due to headlines coming out of the United Kingdom or Europe, and of course United States and China. In other words, this is a very dangerous place to put your money right now. If you’re correct in your trading analysis, it’s great, but unfortunately that can change at the drop of a hat.
Your capital is at risk
I recognize that the market will eventually go looking towards the ¥150 level, of course it’s going to be a very difficult road to get there. At this point, I would keep my position size very small and only add once things are proven to be correct in your analysis.