GBP/JPY Forecast – British Pound Rockets Higher Against Japanese Yen

GBP/JPY Forecast Video for 09.10.23

British Pound vs Japanese Yen Technical Analysis

The British pound has had a stellar day against the Japanese yen, as we continue to see the Japanese yen gets sold into. Because of this, it looks like the British pound is going to try to take over the 50-Day EMA and stay above it. If it does, that opens up the possibility of a move to the ¥185 level, which has been the target all along. Nonetheless, the British pound has been one of the more lackluster performers in the currency markets, so part of this might be short covering as well. Keep in mind that the pair is highly sensitive to risk appetite, so you do have to keep an eye on the overall market sentiment at the same time as taking any trade in this market.

Underneath, the ¥180 level continues to be supported, and I think is the short term “floor in the market.” The market certainly looks a lot better after the Friday session than it did on Thursday, but at the end of the day, we still were always in an uptrend and it was probably only a matter of time before something like this happened. I’ll admit that it was a little bit of surprise on Friday, but it is what it is, and after this massive candlestick, one would have to think that short-term pullbacks will attract a certain amount of attention.

If we can break above the ¥185 level, it opens up a move to the ¥186.50 level, an area that had previously been the recent high. Breaking above that then opens up the next leg higher, which would go back to my original assertion that perhaps the pair could go to ¥200 before it was all said and done. The Bank of Japan will continue to fight interest rate markets, and therefore the Japanese yen will continue to be a currency that loses overall. With that being said, I think it’s probably only a matter of time before this market does break out to the upside, but you may have to ride through a lot of volatility in the process. As is always the case, your position sizing will be crucial in this market.

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