GBP/JPY Forecast Today 17/6: Bullish Trend (Video+Chart)
Date
6/17/2024 2:44:32 PM
(MENAFN- Daily Forex)
You can see that the British pound initially did rally pretty significantly against the Japanese yen, but we have pulled back quite drastically. At one point, we were well above the 201 yen level, and we're even starting to threaten the idea of 202 yen. However, we have since plunged below the 200 yen level, only to bounce again towards the end of the day.
This type of volatility probably makes a little bit of sense on Friday due to the fact that the
bank of Japan had its monetary policy meeting, but really at the end of the day, this is a situation that continues to be more noise than anything else and as a result, you have to look at the longer term trend. The longer term trend is most certainly to the upside and therefore that's how I trade this market.
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I Will Not Short This Pair
I have zero interest whatsoever in trying to short this GBP/JPY market and I do think anybody shorting this market is probably trying to swim upstream. Even if we broke down from here, I'd be very interested in the 50 day EMA which is closer to the 197 Yen level and then after that I'd be looking at the 195 Yen level for no other reason than the psychology of the number. Remember you get paid to hang on to this pair, and therefore traders do tend to flock towards it. Ultimately, I think we do go higher, I think we do break out to the upside and continue to see plenty of buyers willing to take advantage of the positive swap that is such a huge part of trading the British pound against the Japanese yen. It's been a little noisy, but really at the end of the day, this is a market that still looks positive.
Ultimately, this is a pair that pays you at the end of every day and I think a lot of people are going to continue to take advantage of that. The interest rate differential is wide enough to drive a truck through, and therefore I think a lot of people are going to continue to favor the British pound over the Japanese yen and will be willing to hang on to this pair for the longer term.
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