GBP/JPY Forecast – Pound Looks Tired Against the Yen
GBP/JPY Forecast Video for 13.06.23
British Pound vs Japanese Yen Technical Analysis
The British pound has rallied a bit during the early hours on Monday, to continue the move above the ¥175 level. That being said, the market does look like it’s running into a lot of resistance, and perhaps the British pound is a little bit tired against the Japanese yen. Nonetheless, there is a lot of support underneath, so I do think that this will only open up the likelihood of buyers jumping into this market based on value. The ¥175 level of course is a significant round figure that a lot of people will pay attention to, and an area where we had seen a lot of resistance previously. If we were to break above the top of the candlestick for the Monday session, that would obviously be a very bullish sign.
Underneath, I see the ¥172.50 level as potential support, so if we were to break down significantly, then that will be our first major buying area. Underneath there, then you have the ¥170 level, where the 50-Day EMA has just crossed. It is probably worth mentioning that there is a minor support level near the ¥171.50 level, so that could also come into the picture as well.
At this point, the pair does continue to be very noisy, but overall it does end up being a lot of upward momentum over the longer term. Quite frankly, this is just simply a matter of trying to find “cheap pounds” and take advantage of the overall structural weakness of the Japanese yen. Furthermore, the Bank of Japan does have a meeting on Friday, and therefore that could come into the picture as well, although they have already somewhat signaled that that it is very unlikely that they are going to be doing anything to change monetary policy.
In other words, you continue to get paid to hang on to this currency pair via swap, so I just don’t see why traders would suddenly run away from that interest-rate differential situation. Ultimately, I do think that we will try to get to the ¥177.50 level, but you don’t want to be overly exposed to any particular one currency pair at the moment right now, due to the fact that we have so many central banks meeting this week.
For a look at all of today’s economic events, check out our economic calendar.
This article was originally posted on FX Empire