GBP/USD, GBP/JPY Technical Forecast: British Pound Price - Upside Break Out
GBP/USD and GBP/JPY Chart and analysis
GBP/JPY – GBP/USD- Changing Course
On Tuesday, GBP/USD declined to 1.1958 printing its lowest levels in nearly three years. However, yesterday the pair U- turned and traded higher recovering some of its losses. Similarly, GBP/JPY pointed higher yesterday indicating to buyers preparing to take over.
Yesterday, the Relative Strength Index (RSI) climbed above 50 on both pairs, reflecting a possible start of uptrend momentum.
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GBP/USD DAILY PRICE CHART (May 15, 2017 – AUG 29, 2019) Zoomed out
GBP/USD DAILY PRICE CHART (April 25 – Sep 5, 2019) Zoomed IN
Looking at the daily chart, we notice yesterday GBP/USD rallied to a higher trading zone 1.2148 – 1.2360 eyeing a test of the high end of it contingent on clearing the weekly resistance area marked on the chart.
Hence, any close above the high end of the zone could push GBPUSD towards 1.2785. However, the weekly resistance levels underlined o the chart (zoomed in) should be kept in focus.
Also, it’s worth mentioning that since the beginning of May GBP/USD has been trading in a downtrend channel and today, the price showed a significant sign of strength breaking above this channel at 1.2250.
On the flip-side, a close below the low end of the zone, may press the pair towards 1.1800. Although, the daily support level underscored on the chart needs to be watched closely.
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GBP/JPY DAILY PRICE CHART (MAy 15, 2017 – SEP 5, 2019) Zoomed out
GBP/JPY DAILY PRICE CHART (DEC 15, 2016 – SEP 5, 2019) Zoomed in
From the daily chart, we notice that om Tuesday GBP/JPY rebounded nearby 126.77 then reversed direction towards the high end of current trading zone 128.80 – 130.84.
Hence, a close above the high end of the zone could push the GBPJPY towards 133.40. That said, buyers would need to keep an eye on the weekly resistance levels underline on the chart (zoomed in).
It’s worth noting that currently, GBPJPY is testing the neckline of double bottom pattern. This suggests if the price remains above 130.70, it could rally towards 134.85. Taking into consideration the weekly resistance levels marked on the chart.
On the other hand, any failure in closing above the high end could send GBP/JPY back to the low end of current trading zone. Further close below this level could send the price may press the price towards 126.77. In that scenario, the weekly support levels underscored on the chart need to be monitored.
Written By: Mahmoud Alkudsi
Please feel free to contact me on Twitter: @Malkudsi
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.