GBP/JPY Forecast – British Pound Sluggish Again Against the Japanese Yen

GBP/JPY Forecast Video for 11.01.23

British Pound vs Japanese Yen Technical Analysis

The British pound has gone back and forth against the Japanese yen during trading on Tuesday, as we continue to see a lot of back-and-forth overall. We had rallied quite nicely from the lows, only to run into exhausted again. This is a pair that seems to continue to try to recover, but quite frankly a lot of this comes down to things that are on the outside. The most obvious one of course would be the Bank of Japan’s fight against interest rates.

Remember that the Bank of Japan has set a limit of 50 basis points on the 10 year yield, which was tested overnight. However, as they fight interest rates, they have to print Japanese yen. In other words, there are a lot of questions as to whether or not the market can break the Bank of Japan, and you need to keep in mind that the overall supply Japanese yen will continue to rise every time they have to fight those yields.

At this point, the ¥160 level is an area worth paying attention to, because if we break down below there we will probably start to fall yet again. On the other hand, if we break above the ¥161.50 level, could kick off a move to the upside. The 200-Day EMA sits at the ¥162.50 level, so that could be a bit of a ceiling or perhaps even a potential target. Regardless, I think you can probably count on a lot of noisy behavior in this pair, but that’s not too far out of the ordinary for “The Dragon.”

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