GBP/JPY Price Forecast – The British Pound Recovers on Monday

British Pound vs Japanese Yen Technical Analysis

The British pound has bounced significantly against the Japanese yen during trading on Monday, showing a proclivity to continue the upward thrust. This makes sense, as long as the Bank of Japan continues to fight interest rates rising in that country. They are essentially “printing yen”, thereby working against their own currency. As this has been the case for a while, you have seen wild swings in the Japanese yen, most notably to the downside.

This pair is a little bit different than some other yen related pairs, because it is so heavily influenced by risk appetite. That being said, this still remains a “buy on the dips” type of situation, with the ¥168.50 level continuing to offer a bit of a ceiling in this market. If we can finally break above there, then this market has a real opportunity to go much higher, with the most obvious target being the ¥170 level.

As for some type of selling opportunity, I just don’t see it at this point and probably will not any time soon. However, the day that the Bank of Japan finally gives up, the Japanese yen could surge in value as yields will almost certainly skyrocket. Until then, the Japanese yen is going to continue to be a funding currency, just as it has been most of the last several decades. I believe that the bottom of the overall trend is probably found it near the ¥160 level at this point. Given enough time, this market should break out to the upside right along with all of the other yen related markets in this environment.

GBP/JPY Price Forecast Video 05.07.22

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This article was originally posted on FX Empire

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