GBP/JPY Forecast – The British Pound Threatens the Same Resistance Level

GBP/JPY Forecast Video for 13.12.22

British Pound vs Japanese Yen Technical Analysis

The British pound has rallied quite nicely against the Japanese yen during the Monday session, as we continue to see a lot of upward pressure. It’s probably worth noting that the ¥168.50 level has been an area of extreme resistance as of late, so it will be interesting to see if we can continue to go higher. If we can, then the ¥170 level will almost certainly be the target. On the other hand, if we struggle, then it’s likely we fall back to the ¥167.50 level, and then possibly down to the 50-Day EMA, which is presently at the ¥166.275 level.

Regardless, this is a market that looks like it is trying to bottom and form a big “W pattern” which in and of itself is a rather bullish sign. Because of this, it’s very likely that we will go looking to the ¥170 level, but keep in mind this pair is highly sensitive to risk appetite, and of course interest rates as the Bank of Japan continues to fight rising interest rates in its economy. By doing so, they are buying unlimited bonds, which is the same thing as printing unlimited yen.

In this scenario, it’s difficult to imagine the Japanese yen finding any real strength. Ultimately, I think we have a situation where the pair does eventually take off to the upside, but it might be rather messy in the meantime. The market recently formed a little bit of a “double bottom” at the ¥165 level, which is a very healthy sign for the continuation of an uptrend.

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