GBP/JPY, EUR/JPY and AUD/JPY Forecasts – Japanese Yen Continues to Face Pressures

GBP/JPY Technical Analysis

The British pound has drifted a little bit lower against the Japanese yen, only to bounce as we are hanging around the 50-day EMA at the moment. The 50-day EMA is an indicator that has offered a bit of support and like a magnet for price, but if we were to turn around and break above the 214-yen level, then we go looking to the 215-yen level.

A breakdown below the bottom of the candlestick could open up the possibility of a drop to the 212-yen level, but I suspect you would see the Japanese yen strengthening everywhere if that, in fact, ends up being the case.

EUR/JPY Technical Analysis

The euro has been very noisy against the Japanese yen, but it is squeezing out a little bit of an attempt to break to the upside. The 185-yen level continues to be an area that I’ll be watching very closely, especially now that the 50-day EMA sits just 6 pips above there.

If we can clear both of those, then I think that will allow this market to continue going higher. The interest rate differential continues to favor Europe, and it probably will for as long as I can imagine, and therefore, I like buying short-term dips.

The Japanese yen has been under severe pressure against multiple currencies, and that remains the case as the Bank of Japan really won’t be able to do much as far as tightening monetary policy beyond maybe another 25 basis points.

AUD/JPY Technical Analysis

The Australian dollar initially gapped lower during the trading session against the Japanese yen but has turned things around to show signs of life. By doing so, this looks like a market that is, in fact, going to try to get to the 114-yen level eventually.

I think you have to be a little bit patient here, but the good news about that is you also get paid to hang onto this position, so keep that in mind. I believe we go looking to 114 yen sooner rather than later.

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