GBP/JPY Forecast – British Pound Pulls Back Against the Japanese Yen
GBP/JPY Forecast Video for 01.02.23
British Pound vs Japanese Yen Technical Analysis
The British pound has pulled back a bit during the trading session on Tuesday, as we continue to see a lot of volatility. That being said, we will more likely than not see a bigger move in the next couple of days, as we get through a bunch of data and of course the Federal Reserve meeting. Ultimately, this is a pair that is highly sensitive to risk appetite, so that all lines up quite nicely. The market continues to be very noisy, and I think at this point we probably have a huge amount of momentum building up in one direction or the other, but at this point we will have to see how the rest of the market behaves, especially in terms of Japanese yen.
Keep in mind that the Bank of Japan continues to see the need to put a lid on rates, with the 10 year being at the 50 basis points level. Ultimately, as long as they have the issues with interest rates rising around the world, they will continue to print yen, and it does make a certain amount of sense that the Japanese yen will start to lose again.
If we can break above the 50-Day EMA, and then of course the ¥162.50 level, it’s likely that the market could go looking to the ¥165 level. On the other hand, if we break down below the ¥160 level, then it’s possible that we could go down to the ¥159 level. Either way, I think you need to be cautious with your position size and recognize that volatility is probably going to get worse, not better.
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