. Forex Focus: Pound's Resilience Against Yen Amid BoE and BoJ Watch

Forex Focus: Pound’s Resilience Against Yen Amid BoE and BoJ Watch

Forex Focus: Pound’s Resilience Against Yen Amid BoE and BoJ Watch

08 Dec 2023

GBP/JPY: Pound Holds Gains Against Yen on BoE Hawkish Stance and BoJ Policy Watch.

FUNDAMENTAL OVERVIEW:

The GBP/JPY currency pair is currently engaged in tight trading just below the 186.00 level, rebounding from a recent low of 184.45. This movement is occurring as traders anticipate potential shifts in the policies of the Bank of Japan (BoJ), given persistent inflation that has exceeded targets. The pound’s resilience is further supported by comments made by Bank of England (BoE) Governor Andrew Bailey during a Treasury Select Committee session on Tuesday, suggesting that additional rate hikes are still being considered.

This cautious atmosphere among traders reflects a broader trend of heightened sensitivity to central bank communications in forex markets, where statements from officials can significantly impact currency valuations. Consequently, investors and analysts are closely monitoring developments from both the BoE and BoJ for further indications of how monetary policies might evolve in response to ongoing economic challenges.

Technical Overview for GBP/JPY:

Moving Averages:

  • Exponential:
  • MA 10: 184.67 (Negative Crossover – Bearish)
  • MA 20: 185.22 (Negative Crossover – Bearish)
  • MA 50: 184.59 (Negative Crossover – Bearish)

Simple:

  • MA 10: 185.48 (Negative Crossover – Bearish)
  • MA 20: 186.20 (Negative Crossover – Bearish)
  • MA 50: 184.12 (Negative Crossover – Bearish)

RSI (Relative Strength Index): 32.65 (Neutral Zone – Neutral)

Stochastic Oscillator: 23.98 (Neutral Zone – Neutral)

Resistance and Support Levels:

  • R1: 188.40
  • R2: 189.79
  • S1: 179.892
  • S2: 176.233

Overall Sentiment: Bearish Market Direction: Sell

Trade Suggestion:

  • Limit SELL: 179.892
  • Take Profit: 176.233
  • Stop Loss: 181.200