GBP/JPY Forecast – British Pound Has Volatile Session Against the Yen

GBP/JPY Forecast Video for 17.07.23

British Pound vs Japanese Yen Technical Analysis

The British pound has gone back and forth during the course of the trading session on Friday, as it looks like the ¥180 level continues to be important. The market stabilizing here suggests that perhaps the British pound is going to work off the froth after the big move previously, and perhaps go into a consolidation area. The ¥180 level would be supported, while the ¥184 level above offers quite a bit of resistance. After that, then you have the ¥185 level, which is a large, round, psychologically significant figure that the market will pay attention to.

In the short term, I think we have a situation where we are more likely than not simply going to go back and forth and try to figure out where we are going next. On the other hand, if we were to break down below the lows of the previous couple of sessions, we could drop down to the 50-Day EMA, closer to the ¥177.50 level. The 50-Day EMA is followed widely by technical analysts around the world, and therefore I think you need to be cognizant of that potential floor of the market.

On the upside, if we were to break above the ¥185 level, then we could go much higher, perhaps opening up a move to the ¥190 level. In general, we are in an uptrend and it’s likely that we will continue to see plenty of buyers jump in the pickup value as it occurs. Keep in mind that the interest rate differential between the Bank of England and the Bank of Japan continues to be wide, therefore it deftly favors the British pound strengthening. In general, I think that you continue to see more or less a “buy on the dips” attitude, but that doesn’t necessarily mean that we take off right away. At this point, we continue to see a lot of choppy volatility, so therefore you probably have to focus on short-term charts. However, I think you have to focus more or less on the upward trajectory than anything else, as it would take a lot to change the fundamental situation in this market.

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