GBP/JPY Price Forecast – The British Pound Recovers Against the Japanese Yen

British Pound vs Japanese Yen Technical Analysis

The British pound has bounced a bit during the trading session on Monday against the Japanese yen do so signs of life. The 50 Day EMA has offered a bit of dynamic support, and now the market has broken above the ¥162 level. Now that we have cleared that area, we could threaten the ¥162.50 level, but that is an area where we have seen a lot of selling pressure previously, so I would not be surprised at all to see a bit of exhaustion. The market failure in that area would be a signal to start shorting, but if we were to break above that noise, we could go looking to the ¥165 level.

If we do pull back from here, the ¥160 level is an area where I would expect to see a lot of support, which could perhaps extend down to the ¥159 level. If we clear all of that, then this market would almost certainly break down, but the Bank of Japan has been extraordinarily dovish as they are doing everything, they can to keep interest rates down in the bond market and appear ready to continue doing so. As long as that is going to be the case, even the lowly British pound will continue to strengthen against the currency.

However, if the Japanese central bank were to change its attitude, that could throw the markets into complete disarray, because they are starting to complain about the loss of the purchasing power of the yen. Ultimately, this is going to continue to be a very noisy situation so I would be very cautious and keep an eye on the underneath because if we do break down, it is going to be massive.

GBP/JPY Price Forecast Video 10.05.22

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