GBP/JPY Price Forecast – British Pound Rallies Into New Year

The British pound rallied a bit during the trading session on Thursday, which of course was New Year’s Eve. That is the most important thing to think about during this day, the fact that volume in liquidity would have been rather thin. With that being the case, I think what we probably have hear more than anything else is a simple drift higher to follow right along with the general trend.

The 50 day EMA is tilting higher and offering support yet again underneath, so given enough time I think we will see a “buy on the dips” type of marketplace. With that being the case, I like the idea of buying dips because they do offer value and of course the British pound against the Japanese yen is highly sensitive to risk appetite. Despite the fact of everything going on around the world, there still seems to be a lot of risk-taking out there.

GBP/JPY Video 04.01.2021

To the upside, I believe that the ¥142.50 level would be the initial target, but it may take some work to get there. If we can break above that level, then we will probably go looking towards the ¥145 level. All things being equal, I do not have any interest in shorting this pair, but I do recognize that there will be a lot of concerns when it comes to the British economy due to lockdowns, and all of the minute details with the Brexit deal that was just signed. With this, I anticipate choppy but upward momentum, but I would also suggest that if you are looking to sell the Japanese yen, you may do better with higher flying currency such as the Australian dollar or New Zealand dollar.

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