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GBP/JPY Price Forecast – British pound pulls back slightly on Thursday

The British pound pulled back a bit during the trading session on Thursday, as we may have gotten a bit ahead of ourselves. That being said, the massive candle from Wednesday is a sign that we certainly have a lot of momentum but pulling back makes a bit of sense so I think that’s all we are seeing at this point.

The British pound has pulled back a bit during the trading session on Thursday, showing signs of slight weakness. However, I think this is simply going to be a pullback toward support near the ¥141.50 level. The 50 day EMA is just below there, and now we should see a significant amount of support at that point. This bodes well for the pair, but we are approaching the 200 day EMA, so it makes sense that perhaps we have a bit of selling pressure waiting for us. Keep in mind that this pair is highly sensitive to the global economy, but it is also is sensitive to the Brexit, so those headlines will move the market also.

GBP/JPY  Video 25.01.19

The Japanese yen of course is a safety currency so if we have a lot of concerns about the global economy, then we probably see the pair pullback further. I think underneath the 50 day EMA though we will see even more support at the ¥140 level. I believe that the British pound has broken out at least for the medium-term, but we also have a lot of risk out there when it comes to the Brexit agreement and the UK Parliament. Looking at this chart, I expect a lot of volatility but I still have an upward bias for short-term trades. I would not get married to a position though, because a headline noise will be high.

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This article was originally posted on FX Empire

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