GBP/JPY Forecast – British Pound Plunges Against the End

GBP/JPY Forecast Video for 04.08.23

British Pound vs Japanese Yen Technical Analysis

The British pound has plunged during the trading session on Thursday, as we reach toward the ¥180 level. The ¥180 level is an area that the market will continue to see a lot of interest, and therefore the market is likely to see value hunters coming into the pair rather soon. After all, the ¥180 level has been important multiple times, and therefore I think it makes quite a bit of sense that “market memory” comes into the picture. With this being the case, I look at this through the prism of value hunting, and would be more than willing to buy this pair in this general vicinity. Whether or not we get the big move remains to be seen, but I think ultimately, this is a market that I think gives plenty of opportunity but volatility could pick up due to the fact that the jobs report comes out of the United States.

The 50-Day EMA sets just below that crucial ¥180 level, so as it approaches, it does make quite a bit of sense that we would see buyers willing to come in and pick up the pieces. The Japanese yen will continue to suffer in general, due to the fact that the interest rate differential between the Japanese and almost everybody else is miles wide. The Bank of Japan recently tried to talk down the effects on its currency, but then turned around to buy bonds again, effectively doing quantitative easing.

I think this continues to be the case going forward, and the fact that the Bank of England just raised interest rates yet another 25 basis points means that this market will more likely than not continue to find buyers on dips. With this, I’m looking for an opportunity to pick up bits of value, but also recognize that the next 24 hours could be rather noisy to say the least. If we get more of a “risk on rally” in equities, that may show itself in this pair as well, as buyers jump in.

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