GBP/JPY Forecast – British Pound Pulls Back Against Japanese Yen

GBP/JPY Forecast Video for 01.09.23

British Pound vs Japanese Yen Technical Analysis

The British pound has pulled back just a bit during the trading session on Thursday, showing signs of hesitation, but at this point I think the market will continue to be very bullish overall. After all, we have a major interest rate differential between the British pound and the Japanese yen, as the Bank of Japan continues its overall loose monetary policy. With that being the case, I do think that we go higher over the longer term. Because of this, I am a buyer of dips, and I also look at the charts through the prism of trying to find value.

Underneath, the ¥182 level should offer plenty of support, due to the fact that it was previous resistance, and of course we also have the 50-Day EMA hanging around that area. I think that any value offered at this point in time will get jumped on as we have been in a major uptrend for quite some time, and I just don’t see how that changes anytime soon. In fact, it’s not until we break down below the ¥180 level that I would be a seller of this market.

On the upside, if we clear the ¥187 level, then the market could go much higher. I think this eventually happens, and when it does the British pound will go looking to reach the ¥190 level. After that, then we will continue to reach toward the ¥200 level, which is a longer-term trend as far as I can see. However, keep in mind that this market is highly sensitive to interest rates around the world, and if they rise or fall will have a major influence on what happens with the yen. The higher rates go, the weaker the yen will get. If all things remain the same, then it is probably only a matter of time before we continue to see this push higher. After all, Great Britain still is dealing with quite a bit of inflation, although it’s not as bad as it once was, but you do get paid to hold onto the trade and that is the main theme here.

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