This pair is on my watchlist for the coming week. The pair initially fell during the week, dropping below the 140.00 price level and then turned around with BOE news to form a hammer on the Weekly chart. The “risk on/risk off” market is a driver of this pair. The pair closed a few pips below a strong resistance level at 141.70 on Friday and consolidated for most of Friday at this price area, that we can clearly see on the H1 chart. I’ve commented often in my posts that the longer a pair like GBPJPY consolidates, the more volatile the ensuing breakout tends to be, so keep this in mind.
I’m on the side-line for now until I see how the market reacts to the 141.70 level with the market open on Sunday and into the new trading week. A clear and confirmed break above 141.70 should take us back to the 148.00 area and a break below will open to 135.50 support area. Best will be to watch for breaks on the larger time-frames i.e. H4 and Daily. Information received from BOE and political in Britain is conflicting, making trading of GBP risky at this time, so stay away from GBP pairs for now if you are not yet experienced with volatility trading.