GBP/JPY Forecast – British Pound Continues to Grind Higher Against the Japanese Yen

GBP/JPY Forecast Video for 31.08.23

British Pound vs Japanese Yen Technical Analysis

The British pound has rallied significantly during the trading session on Wednesday, as we have broken above the ¥185 level, an area that of course is a large, round, psychologically significant figure. That being said, any short-term pullback should end up being a buying opportunity, and I do think that eventually the market goes much higher. After all, we are seeing the British pound rally against most currencies, and therefore it will continue to gain against the lowly Japanese Yen. Remember, the Bank of Japan continues to do everything it can to keep interest rates low, and therefore that means jumping into the bond market and engaging in “quantitative easing.”

Short-term pullbacks at this point in time I think attract a lot of attention, and I do believe that eventually we will reach the highs again. If and when we blow through there, then I think the ¥190 level would be your next target. Eventually, I fully anticipate seeing this market jump all the way to the ¥200 level, but that doesn’t necessarily mean that it’s going to be easy to get there. There will be multiple twists and turns along the way, but I do think that given enough time we can eventually get there. However, there’s also the risk appetite situation that you have to pay close attention to, as the pair does tend to rise and fall with whether or not we are going to take risks in the market overall.

Because of this, pay attention to the idea of where stock markets are going, because that’s probably the easiest way to determine where risk appetite is heading for the session. That being said, it’s not necessarily a perfect one to one correlation, but it does give you an idea of where we may go. That being said, if we were to break down from here, I do believe that the 50 Day EMA is likely to be an area of support, and that of course we have the ¥180 level is an area of support as well. As long as we can stay above all of that, I think you continue to buy value as it occurs.

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