GBP/JPY Price Forecast – British pound fails at resistance

The British pound has tried to rally during the trading session going into the UK parliament vote but has failed at the psychologically and structurally important ¥140 level. That’s an area that I think it extends all the way to the ¥141 level, and I think it’s only a matter of time before we start falling again. After all, not only do we have all of the concerns about the Brexit, and perhaps the brutal vote ahead late on Tuesday, but we also have to worry about global growth and global risk appetite which does have an effect on this market.

GBP/JPY  Video 16.01.19

Ultimately, I think that selling is still going to be the way going forward, but if we were to break above the ¥141 level, then I think the market could go much higher, perhaps even as high as ¥145. Ultimately though, I think that requires two things: some type of Brexit agreement or signs that we are getting close, and of course a resolution to the US/Chinese trade situation. Neither of these look likely to happen in the short term, so I think that it makes more sense that rallies continues to be faded by the majority of traders out there. I think that the ¥138 level will offer a bit of support, but if we can break down below there we could go down to the ¥137 level, and then start looking towards ¥135 after that. Ultimately, I’m a seller of this pair until something changes on both of those fronts mentioned previously.