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GBP/JPY Forecast – British Pound Continues to Threaten Upward Momentum

By:
Christopher Lewis
Updated: Jan 23, 2023, 13:53 UTC

The British pound has rallied again against the Japanese yen during trading on Monday, as it looks like it’s doing everything he can to break out to the upside.

British Pound, FX Empire

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GBP/JPY Forecast Video for 24.01.23

British Pound vs Japanese Yen Technical Analysis

The British pound has rallied a bit during the trading session on Monday, to threaten the ¥161.50 level, an area that has been rather resistant to buying pressure as of late. That being said, it is more likely than not that there are buyers underneath willing to get involved due to the fact that the Bank of Japan is doing everything it can to keep interest rates down, and has recently reiterated its desire to do so. As a result, I do believe that the Japanese yen may start to face a lot of selling pressure again, and quite frankly I think the Bank of Japan is somewhat stuck in this pattern of having to continue its path going forward.

Ultimately, if we turn around and break down below the ¥160 level, then it means we are just not ready to take off to the upside and it will probably be time to start looking for support at lower levels to essentially “reset the trade.” Currently, it looks as if the ¥155 level has offered enough support to form a bit of a “double bottom”, and therefore I think you need to look at it through the prism of whether or not we have a sufficient amount of momentum to stay above there or break down below it.

I think at this point we are trying to enter some type of range, as we determine what the next move is. I look at pullbacks as potential buying opportunities, but also recognize that breaking above the ¥161.50 level means that momentum is picking up to the upside, and we could go as high as ¥165 rather quickly.

For a look at all of today’s economic events, check out our economic calendar.

About the Author

Being FXEmpire’s analyst since the early days of the website, Chris has over 20 years of experience across various markets and assets – currencies, indices, and commodities. He is a proprietary trader as well trading institutional accounts.

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