GBP/JPY Price Forecast – British pound struggles again on Monday

The British pound has initially rallied during the day on Monday, but then pulled back rather significantly as headlines are coming out that Teresa May is perhaps thinking about postponing the Brexit vote, in a bid to save the deal that she has put forth. This is not a good sign and suggest that we will probably see the potential of a “no deal Brexit” increase. As long as that’s going to be the case, the British pound will continue to struggle overall. In fact, I think at this point we are probably going to see the British pound dropped to ¥141 rather soon, and then possibly even the ¥140 level. At this point in time, you would have to think that the ¥145 level above is massive resistance, and unlikely to be broken without some type of an agreement being signed.

GBP/JPY  Video 11.12.18

As we approach the holidays, many traders will not want to take on risk anyway, especially in the global growth environment and the Sino-American relations problems, so quite frankly I think there is a perfect storm of negativity out there to continue to push this market to the downside. Ultimately, I think at this point we are going to continue to see sellers jump in on rallies, so look for exhaustion to either add to a position or start shorting. Between now and New Year’s Day, the British pound is probably the most active currency that we are going to see.