GBP/JPY Price Forecast – British Pound Takes OffThe British pound shot straight up in the air against the Japanese yen during trading on Monday as we kicked off the week on the good foot.
The British pound has taken off during the trading session on Monday to kick off the week very strongly, as it looks like we are cleanly above the ¥145 level and racing towards the ¥147.50 level. However, I will be waiting for short-term pullback in order to take advantage of value, because this is an extremely overdone move. That is not to say that we cannot continue to go towards the ¥147.50 level without pulling back, just that buying the pair all the way appear is reckless at best. Longer-term, I think we go looking towards the ¥150 level, but it is going to take some time to get there.
GBP/JPY Video 16.02.21
Keep in mind that this pair is highly sensitive to risk appetite, so you need to keep in mind what is going on around the world. Yes, it is getting a boost due to the fact that the UK economy should at least in theory be opening up quicker than many others, due to the coronavirus vaccinations but at the end of the day markets can go only go straight up in the air for so long. Sooner or later, a bit of gravity comes into the picture.
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The size of the candlestick should leave no doubt as to the tone of the market, so I have no interest whatsoever in shorting this pair. That being said, I believe that the ¥145 level should be a massive floor in the market, so I am willing to buy the market anytime we get close to that area. That being said, if we were to break down below the ¥144 level, then I think the market may have a more significant pullback ahead. Until then, I assume that we continue to go higher.