GBP/JPY Price Forecast – British pound runs into resistance

The British pound initially tried to rally during the trading session on Wednesday but ran into a bit of trouble at the ¥138 region, and of course the previous 61.8% Fibonacci retracement level. At this point, I suspect that there will be sellers coming into the marketplace to take advantage of “cheap yen.” However, if we were to break above the ¥138 level, it’s very likely that we could continue to go higher, perhaps trying to wipe out some of the oversold condition.

GBP/JPY  Video 06.06.19

The ¥140 level above is major resistance, as it is a large, round, psychologically significant figure. That’s an area that I think will be difficult to get beyond, and it’s very likely that if we did it would be a major turn of events. Ultimately, short-term rallies should continue to be faded at the first sign of trouble. Now that we have broken below the 61.8% Fibonacci retracement level, it is likely to get down to the 100% Fibonacci level, near the ¥131 level. That’s an area that I think a lot of buyers would come back in based upon value. We are oversold, but it looks like we continue to see a lot of sellers. Ultimately, I would be very cautious about buying this pair, because quite frankly the Brexit should continue to cause issues and we most certainly have a lot of concerns when it comes to global growth. Quite frankly, it’s difficult to imagine a scenario where this market goes higher for the longer-term.

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