GBPJPY traded with a bid tone for the entire last week. The currency pair is based on the value of the British pound sterling against the Japanese yen, and it is one of the most popular currency pairs traded on the international Forex market. GBPJPY is famous for its extreme volatility that’s why the cross-pair is nicknamed "the dragon" and “the beast”.
This article is about the fundamental and technical outlook of GBPJPY while keep in mind that this pair is highly sensitive to risk appetite so when you trade don’t place the stop loss too close to the key resistance and support levels.
GBPJPY Fundamental outlook
GBPJPY forecast for the long-term largely revolves around the Bank of England policy vs. the Bank of Japan policy. The GBPUSD ended below 1.2500 on Friday as investors remain concerned about the aggressive monetary tightening path from the BOE. On the other hand, the USDJPY closed above 130.50 on Friday despite a softer US dollar. The JPY remain under pressure at the start of a new month driven by a dovish remark from the Bank of Japan (BoJ) and a fresh rise in US Treasury yields. The Fed’s path to tightening its monetary policy is also affecting the Japanese Yen.
The main important events to watch for GBPJPY traders this week,
Japan household spending - Tuesday
UK services PMI - Tuesday
japan GDP numbers for the 1st quarter - Wednesday
GBPJPY Technical outlook
Technically, the overall movement has remained bullish in the last couple of weeks. As of this writing, the currency pair trades above 164. While considering the recently bullish rally the currency pair may find strong resistance around 164.80 and 165 where the price has strong resistance. Any pullback from current levels will first target 160.30 before 159.40 and 158/156.80 from the incremental barriers to the south. On the upper side, the key resistance is around 165, any break and close above this level will open 168. However, there will need to be enough momentum to break the resistance at 165.
Trading is risky and your entire investment may be at risk. Please ensure that you fully understand the risks involved.