British Pound Forecast: GBP/USD, GBP/JPY
British Pound, GBP/USD, GBP/JPY Talking Points:
- GBP/USD tested below the 1.3000 big figure this week but, so far, bulls have defended that level as USD has shown a bit of pullback from the 200-day moving average. While the pair has been battered, it can be one of the more attractive major pairings for USD-pullback scenarios, as discussed in this week’s US Dollar Price Action Setups.
- GBP/JPY Is continuing to test a key Fibonacci level for a third week and there’s also an element of support showing at prior resistance.
- I look into each of these markets every Tuesday in the live webinar and you’re welcome to join the next installment: Click here for registration information.
It was a fast turn in GBP/USD to start Q4 trade, but that statement can be spanned across most major currency pairs as the US Dollar came back to life, breaking above a falling wedge formation and continuing to run until this week’s test of the 200-day moving average in DXY.
There’s some important context between the major pairs of EUR/USD and GBP/USD, however.
Last month, it was the 1.3000 level in GBP/USD that led into a strong bullish run, with the pair eventually driving up to the Fibonacci level at 1.3414 before finally starting to find sellers. At the time of that 1.3000 defense, there was a similar show in EUR/USD at 1.1000. In both cases, buyers showed early in anticipation of the swing, with lows printing just two pips above each respective big figure. In EUR/USD, prices pushed right back to 1.1200 before stalling for a couple weeks through the end of Q3. In GBP/USD, the stretch was more than 400 pips as the Fibonacci level came into play.
But more relevant for strategy purposes is what’s happened after. EUR/USD has pushed well below that previously-defended support and, at this point, that level isn’t even in the conversation for resistance potential in the pair’s sell-off.
GBP/USD, meanwhile, has seen an element of defense after that 1.3000 price was traded through briefly last week. As we wind into the end of the week, a case can even be made for a shorter-term show of bullish price action, with the four-hour chart showing a short-term higher-high as traders pushed back above the 1.3000 handle. If a higher-low can hold, then there would be the makings of bullish trend potential on the four-hour chart.
GBP/USD Four-Hour Price Chart
From the daily chart, bulls still have some work to do to re-take control, as the case can still be made that we’ve seen resistance play from a prior spot of support, around the 1.3070 level. Sitting overhead are short-term resistance levels at 1.3114 and 1.3134, after which a longer-term level comes into the picture at 1.3161.
GBP/USD Daily Price Chart
GBP/JPY
On a fundamental front, I’m personally skeptical about the return of the carry trade in USD/JPY which, in-turn, would imply skepticism around the return of carry trades in GBP/JPY, as well.
But as I shared in the weekend video and article around the USD pertinent to USD/JPY, all that we’ve seen thus far in the major pair is failure at 150.00. I don’t yet want to assume that the trend is done because we’ve still seen buyers supporting higher-lows, and the zone of resistance in USD/JPY spans all the way up to 151.95.
Now, perhaps that changes next week. But, if it doesn’t, there’s still technical breakout potential in GBP/JPY as a long-term Fibonacci level has been continually tested over the past three weeks and there’s also been a build of higher-lows to go along with that.
That diminishing impact of resistance can lead to eventual breakouts, especially if we haven’t yet seen a top formed in the major pair of USD/JPY.
GBP/JPY Daily Price Chart
From the longer-term weekly chart, we can get better view of that stalling that’s shown at the Fibonacci level, and we can also glean some invalidation levels to investigate if we do see bulls end up failing.
I’m tracking support in a zone from 193.61-194.11, and below that, a zone from 190-190.81. If that second zone comes into play, I’m probably going to begin the assumption that bulls have failed and USD/JPY is showing a greater turn.
On the resistance side of the coin, if we do see bullish breakout, the next zone of interest runs from the 197.42 Fibonacci level up to the 198.08 prior price swing.
GBP/JPY Weekly Price Chart
--- written by James Stanley, Senior Strategist
StoneX Europe Ltd may make third party material available on this website which may contain information included but not limited to the conditions of financial markets. The material is for information purposes only and does not contain, and should not be construed as containing, investment advice and/or investment recommendation and/or an investment research and/or an offer of or solicitation for any transactions in financial instruments; any decision to enter into a specific transaction shall be made by the client following an assessment by him/her of their situation.
StoneX Europe Ltd makes no representation or warranty and assumes no liability as to the accuracy or completeness of the information provided, nor any loss arising from any investment based on a recommendation, forecast or other information supplied. You should always seek independent advice as to your suitability to speculate in any related markets and your ability to assume the associated risks, if you are at all unsure. We are not under any obligation to update any such material. Any opinion made may be personal to the author and may not reflect the opinion of StoneX Europe Ltd.
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Please ensure you fully understand the risks involved by reading our full risk warning.
FOREX.com is a trading name of StoneX Europe Limited, and FOREX.com/ie is a domain operated by StoneX Europe Ltd, a member of StoneX Group Inc. StoneX Europe Ltd, is a Cyprus Investment Firm (CIF) company registered to the Department of Registrar of Companies and Official Receiver with a Registration Number HE409708, and authorized and regulated by the Cyprus Securities & Exchange Commission (CySEC) under license number 400/21. StoneX Europe is a Member of the Investor Compensation Fund (ICF) and has its registered address at Nikokreontos 2, 5th Floor, 1066 Nicosia, Cyprus.
StoneX Europe Limited is registered with the German Federal Financial Supervisory Authority (BaFin). BaFin registration ID: 10160255
FOREX.com is a trademark of StoneX Europe Ltd, a member of StoneX Group Inc.
The statistical data and the awards received refer to the Global FOREX.com brand.
This website uses cookies to provide you with the very best experience and to know you better. By visiting our website with your browser set to allow cookies, you consent to our use of cookies as described in our Privacy Policy.
Through passporting, StoneX Europe is allowed to provide its services and products on a cross-border basis to the following European Economic Area ("EEA") states: Austria, Bulgaria, Croatia, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, Netherlands, Norway, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden.
Additionally, StoneX Europe Ltd is allowed to provide Investment and Ancillary Services to the following non-EU jurisdiction: Switzerland.
StoneX Europe Ltd products, services and information are not intended for residents other than the ones stated above.
Tied Agent Information: KQ Markets Europe Ltd with Company No. HE427857.
Address: Athalassas 62, Mezzanine, Strovolos, Nicosia Cyprus.
Services Provided: Reception and Transmission of Orders.
Commencement Date: 06/12/2022
Website: KQ Markets - CFD Trading | KQ Markets
We may pay inducements, such as commissions or fees, to affiliates or third-party introducers for referring clients to us. This is in line with regulatory guidelines and fully disclosed where applicable.
StoneX Europe Ltd may make third party material available on this website which may contain information included but not limited to the conditions of financial markets. The material is for information purposes only and does not contain, and should not be construed as containing, investment advice and/or investment recommendation and/or an investment research and/or an offer of or solicitation for any transactions in financial instruments; any decision to enter into a specific transaction shall be made by the client following an assessment by him/her of their situation. StoneX Europe Ltd makes no representation or warranty and assumes no liability as to the accuracy or completeness of the information provided, nor any loss arising from any investment based on a recommendation, forecast or other information supplied. You should always seek independent advice as to your suitability to speculate in any related markets and your ability to assume the associated risks, if you are at all unsure. We are not under any obligation to update any such material. Any opinion made may be personal to the author and may not reflect the opinion of StoneX Europe Ltd.
© FOREX.COM 2025