The Pound-to-Yen exchange rate could rally ahead of other Sterling pairs in the coming weeks and months if a recovery of the British currency coincides with resilience in American bonds yields or any other factor that prevents the Japanese currency itself from strengthening against the U.S. Dollar.
The Japanese Yen advanced against most major currencies on Friday as the Dollar rose amid faltering investor risk appetite, and after the Bank of Japan (BoJ) was sighted assembling a rifle and possibly preparing to enter into a currency war in which warning shots have effectively already been fired.
The Dollar-Yen exchange rate has fallen a further 0.20% to reach 104.62 at the time of publication on Tuesday. Analyst Richard Perry of Hantec Markets continues to favour the Yen over the Dollar, based on his studies of the technical setup.
Analysis from SuMi TRUST - one of the largest financial services groups in Japan - have said the Japanese Yen could potentially strengthen should Democrat nominee Joe Biden win the November U.S. presidential election.
The Dollar-Yen exchange rate fell a sizeable 0.88% on Wednesday and is seen at 104.50 on Tuesday. Following the sizeable move, analyst Richard Perry at Hantec Markets considers the potential next levels the pair might achieve.