GBP/JPY Forecast – British Pound Continues to Go Higher Against the Japanese Yen

GBP/JPY Forecast Video for 14.06.23

British Pound vs Japanese Yen Technical Analysis

The British pound has rallied significantly during the trading session on Tuesday to break well above the ¥175 level again. At this point, the market looks as if it remains a “buy on the dip” type of situation, and therefore you have to look at this through the prism of trying to find value as we go along. Ultimately, this is a market that is extraordinarily bullish, due to the fact that the central banks have such a huge amount of divergence between the 2 of them. The Bank of Japan has a meeting on Friday that a lot of people will be paying attention to, although they have suggested already that they will probably do very little to change monetary policy.

As long as that is going to be the case, it’s likely that we would continue to see a major push toward the British pound. That being said, the market underneath could show plenty of opportunities to pick up cheap British pounds, and I think that’s probably going to continue to be the way going forward. The ¥172.50 level is an area where we have seen support previously, and therefore it’s likely that we will see it again. After that, then you have a move down to the ¥171.50 level underneath, with the 50-Day EMA rapidly approaching that level. Alternatively, I think the “bottom of the market” is currently at ¥170 level, and therefore I think anything below there opens up the possibility of a big move to the downside.

If we continue to go higher, then the ¥177.50 level will offer a target eventually, with the ¥180 level being a major target after that. All things being equal, this is a market that I think continues to see a lot of noisy behavior, but I think there’s so much in the way of support underneath that we will eventually hit those targets above. This will be especially true if the Bank of Japan continues to sit on its hands, and leave its monetary policy ultra loose. At the same time, the Bank of England continues to fight inflation, so it certainly makes sense that we would continue to see the British pound much more attractive than the Japanese yen.

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