GBP/JPY Weekly Forecast – British Pound Breaks Above the ¥160 Level
GBP/JPY Forecast Video for 23.01.23
British Pound vs Japanese Yen Weekly Technical Analysis
The British pound has rallied significantly during the week, as we continue to see the Bank of Japan do everything it can to keep the interest rates in the 10 year note down to 50 basis points. Ultimately, yield curve control does horrible things to a currency, so it’ll be interesting to see whether or not they can continue to do this. Ultimately, I think it’s a question of whether or not the markets going to force the issue in the bond market, or if the Bank of Japan can continue to print enough yen to buy unlimited bonds. If rates around the world continue to rise based upon credit risks, that could be disastrous for the Japanese, as they will have to do everything they can to fight raising rates.
On the other hand, if yields start to fall everywhere it can cause a bit of relief for the Japanese, but it will be interesting to see how that plays out. At this point, I think if we break above that weekly candlestick, then it’s likely that we go looking to the ¥165 level.
All things being equal, I think this is a market that eventually makes that move as things stand, so I am looking at short-term pullbacks as buying opportunities, but I also recognize that you will have to be cautious with your position size, mainly due to the fact that there’s so much noise out there and of course the pair is highly sensitive to risk appetite, and there are plenty of concerns out there that I think could move this market. I believe at this point, we have reasons to believe that volatility will be the main factor.
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