GBP/JPY Price Forecast – British Pound Continues to Show Strength

The British pound has rallied significantly against the Japanese Yen yet again during the trading session on Monday as we continue to chisel away at the ¥150 level. The ¥150 level is obviously a large, round, psychologically significant figure, and will attract a significant amount of attention. If and when we can leave the ¥150 level behind, the market is likely to go looking towards the ¥152.50 level, possibly even the ¥155 level.

GBP/JPY Video 9.03.21

That being said, the market pulling back could also be necessary in order to build up momentum to go long and leave this area behind. After all, the British pound has been very strong and the Japanese yen is getting pummeled against most other currencies, so that sets up for a little bit of a “perfect storm”, although we are a bit stretched. The real question now is whether or not the recent consolidation was enough to work off some of the excess “froth” in the markets that we have seen. Regardless, this is a market that simply cannot be shorted, and if we do pull back then I am looking for buying opportunities near the ¥147.50 level, and especially at the ¥145 level as it would represent a significant amount of value.

Looking at this chart, we are obviously a little bit stretched, but there is no way to fight this type of trend. After all, we have seen every time that this market starts to fall, buyers come in and pick it up. All things being equal, this is a market that I do think goes much higher given enough time, especially as the UK begins to reopen.

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