GBP/JPY Weekly Price Forecast – British pound turns around drastically
The British pound exploded to the upside during the week, but then turned around of form a massive shooting star at resistance. This resistance is essentially the ¥150 level. Because of this, the market turned around to form a massive shooting star. The market forming a shooting star is a very negative sign, and you can see that the downtrend line that we had broken out of still remains, meaning that we are at a very serious inflection point. If we break down below the weekly candle, we could drop down to the ¥145 level, and then possibly the ¥140 level. At this point, it would not surprise me at all to see this market consolidate between the ¥140 level and the ¥150 levels. Overall, I believe that the market is trying to break out to the upside for the longer-term, but a lot of this is going to come down to the reaction of Brexit.
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If we do break above the shooting star, the market could go to the ¥155 level next, which was the recent high. Overall, I think that the market is going to continue to be very volatile, and of course this pair is going to be very sensitive to the US/China trade relations. Overall, the market is likely to continue to be very difficult, and more or less headlined driven overall. I think that we will eventually go higher, but we may need to pullback over the next several weeks to build up enough momentum. If we did break down below the ¥140 level, it would be extraordinarily bearish.