GBP/JPY Weekly Price Forecast – British Pound Pierces Major Resistance

The British pound has rallied significantly against the Japanese yen during trading on the past week, and now it looks as if we are ready to continue going higher. Although we have pulled back from the highs on the weekly candlestick, the reality is that this probably has more to do with the US dollar falling against the Japanese yen, thus making the Japanese yen suddenly stronger on Friday. This is a temporary phenomenon, as the British pound breaks out against the US dollar.

GBP/JPY Video 31.08.20

At this point, it looks likely that we will go looking to reach towards the 200 week EMA, something that we have not touched in several months. It does not mean that it is going to be easy, but I fully anticipate that we will not only have the 200 week EMA, but we may actually reach as high as ¥145 over the next couple of weeks. This would require some type of major “risk on rally”, but let us face it here: “risk on” is all that we have seen in general other than a few brief moments. It does not have to make sense, it is what it is, pandemic be damned.

Buying dips continues to make sense, and if we can break above the crucial ¥147.50 level, we will have completely changed the overall trend and will be looking at much higher levels. I suspect that the Bank of Japan will probably do what it can to make this happen as well, so do not be surprised if they start chirping from the sidelines as well.

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