GBP/JPY Weekly Price Forecast – Breaks Through to Reach Big Figure

The British pound has initially pulled back just a bit during the course of the trading week but then shot higher as we had more of a “risk on” type of situation. The market is at roughly ¥144, looking to get to the ¥145 level rather quickly. With that being the case, it is likely that we will continue to see upward pressure, at least in the short term. However, the risk to reward is not quite as great as it was earlier in the week.

GBP/JPY Video 01.02.21

To the downside, the 200 week EMA should offer support at the ¥142.50 level, as traders await the breakout of the ¥145 level to continue going higher. Keep in mind that this pair is highly sensitive to the risk appetite in general, so with that being the case it is likely to move with the latest headlines coming out of not only the United Kingdom, but the world in general as we pay attention to coronavirus figures and of course global growth.

At this point, it is very difficult to short this market even though it is obvious that we are probably going to see more of a “buy on the dips” type of scenario, as the world is starting to get giddy with anticipation of a full recovery after the pandemic it. Whether or not that is the case is a completely different question, but at this point I think we are likely to see an attempt to push risk appetite higher in general, including this market, as people get away from the safety currency part of the equation.

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