GBP/JPY Forecast – British Pound Continues to Rally Against the Yen

GBP/JPY Forecast Video for 07.11.23

British Pound vs Japanese Yen Technical Analysis

The British pound has rallied a bit against the Japanese yen during the trading session on Monday, as we continue to see a lot of noisy behavior. All things being equal, this is a market that looks like it is trying to get to the highs again, but it doesn’t necessarily mean that we get there easily. That being said, the Bank of Japan and its ultra-loose monetary policy will continue to see its currency hammered. The British pound on the other hand, does have a significant amount of interest in it to begin with, so that only sends this market even higher.

Underneath, we have the 50-Day EMA, which of course will offer technical support, but I think it’s probably difficult to make that happen. After all, the indicator was flat and is now turning higher, suggesting that momentum is coming back into the market, something which of course we already know, and therefore I think a lot of traders are simply waiting for some type of value playing, which of course dropping toward the 50-Day EMA would be a nice setup. On the other hand, if we just simply take off to the upside, then the market could challenge the recent highs, perhaps even try to break toward the ¥190 level.

I don’t have an interest in shorting the spare, nor do I have any interest in shorting other yen related pairs, as the Bank of Japan has already shown itself unwilling to tighten monetary policy, therefore there’s no real hope for the yen to suddenly take off. With that being the case, the market is likely to continue to punish the Japanese yen, not only against the British pound, but other currencies as well. Furthermore, you get paid to hang on to this pair, so it does end up being a bit of an investment as well. The ¥180 level underneath would be massive support, and if we were to break down below there, it would be a big deal, but I just don’t see that happening anytime soon.

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