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

GBP/JPY Forecast Video for 24.05.23

British Pound vs Japanese Yen Technical Analysis

The British pound has fallen initially during the trading session on Tuesday, only to test the support level that we have been dealing with for several days now. Ultimately, this market continues to see a lot of back-and-forth, and that makes quite a bit of sense considering that people don’t know what to do with the economy. However, the interest rate differential continues to be a major driver of where we go, as the Bank of Japan has been working against the rising interest rates in its domestic bond market, therefore it’s been printing Japanese yen. This of course drives down the value of the yen, and it has been seen across the Forex world.

Looking at this chart, you can see that we are obviously very bullish, so there’s no reason to think that we should be shorting it any time soon. Yes, we may get some type of pullback occasionally, but that will be a nice buying opportunity, with the ¥170 level underneath being a significant support level just waiting to happen, and of course, there is a lot of psychology to that number.

All things being equal, this is a market that I think continues to see a lot of buyers on dips and I would approach it as such. The ¥172.50 level is a major resistance barrier, and breaking above there could open up even more buying. At this point, it could send the pair toward the ¥175 level. The ¥175 level could be a barrier, if for no other reason than the psychology of the market.

All things being equal, this is a market that continues to be noisy, but I just don’t see the argument that shorting anytime soon. Ultimately, I think this is a situation where we continue to see a lot of volatility, but at this point, I just don’t think that the sellers have enough of a fundamental reason to push our market down over the longer term. Look for value, and take advantage of it as it is going to continue to be a main theme in this market.

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