The GBP/JPY pair is expected to remain positive due to the significant interest rate differential between the British pound and the Japanese yen. Many traders are holding onto this pair for this reason.
Short-term pullbacks in the market present buying opportunities, as the interest rate gap is large enough to make holding onto the pair profitable. Even if the Bank of England were to cut rates, the interest rate differential is still substantial.
There is strong support for the GBP/JPY pair at the ¥205 and ¥200 levels, with the latter being reinforced by the 50-Day EMA. This technical indicator is closely watched by many traders.
The market has been bullish, and it is unlikely that there will be a significant shift in the near future. It is considered a “one-way trade” with buyers likely to step in to seize any value that emerges during pullbacks. Shorting the GBP/JPY pair is not a favorable option at this time.