GBP/JPY Weekly Forecast – British Pound Spikes During the Week

GBP/JPY Forecast Video for 27.02.23

British Pound vs Japanese Yen Weekly Technical Analysis

The British pound broke out during the week, as we have seen a lot of bullish pressure in the British pound this week as inflation seems to be a little stickier than once thought. More importantly, the market is paying close attention to the Bank of Japan and its monetary policy, as we have a lot of pressure on yields around the world. Remember, the Bank of Japan is trying to keep interest rates on the 10 year note down to 50 basis points, meaning that they will have to continue to print yen, therefore it makes quite a bit of sense that we would see a lot of pressure against it.

Looking at this chart, the ¥165 level is my target eventually, but quite frankly I don’t have an idea as to how long it will take. It’s obvious that we are chopping around in this area, but when you look at the shorter-term charts, perhaps the daily or the 4 hour chart, you can see clearly that we have broken out of a resistance barrier, pulled back to test for support, and then bounced again.

In other words, it’s more likely than not that we continue to go higher but it doesn’t necessarily mean that we take off right away. After all, when you look to the left there is a lot of noise in general, and we are fighting a nasty candlestick as it was a reaction to the Bank of Japan allowing interest rates to rise from 25 basis points to 50. I have no interest in buying the yen at this point, regardless of the currency it’s being measured against.

For a look at all of today’s economic events, check out our economic calendar.