Wall Street is trading with gains, indicating that investors are optimistic about the market.
GBP/JPY Forecast: Higher but faces resistance in the 157.00-158.00 region.
The British pound has been registering a remarkable rally during the New York session. It is up nearly 3% so far. The GBP/JPY trades at 157.07 as of the writing.
Markets are showing positive risk sentiment. European equity shares posted gains while US stocks finished the week in green. Risk-sensitive currencies are on the rise in the FX space. The JPY and EUR are down respectively by 0.40% and 0.5%.
The Russia-Ukraine conflict and developments surrounding it are two factors that have caused sentiment shifts. Russia asked China for financial and military aid while the US threatens to impose sanctions against the Asian dragon.
Friday’s videoconference saw Joe Biden, the US President, and Xi Jinping, the Chinese leader. Xi Jinping assured that China does not want to wage war against Ukraine. Xi criticized Russia’s sanctions, saying that the “ordinary people” are those who suffer.
Overnight, GBP/JPY opened at the 156.00 mark. However, it pushed through the Asian session highs and stalled later in the 156.50 zone. The cross-currency pair rallied to 157.00 once the North American session started.
GBP/JPY Forecast: Technical outlook
GBP/JPY has an upward bias and reached a daily peak of 157.22. It has been slipping below the 157.00 mark of late. However, the presence of daily moving averages in a bullish orly manner, well below spot price, confirms that the trend is upwards.
The GBP/JPY’s first resistance would be 157.00. Breach of this would expose the confluence between a six-month-old trendline and the February 18th daily high at 157.29. This is followed by the 158.00-06 region, which confluences to the YTD high.
