GBP/JPY Price Forecast – British pound testing resistance

The British pound has gone back and forth during the trading session on Wednesday, as the ¥140 level continues offer significant resistance. Beyond that, the 50 day EMA is just above, pictured in red on the chart. As you can see it is sloping lower, and it certainly suggests that we still have a lot of resistance above. In fact, I believe that the resistance runs all the way to the ¥141 level. Ultimately, I think that signs of exhaustion are to be sold, but clearly we have a lot of bullish pressure underneath. In other words, this is going to be the range that we are trading in over the next several sessions in my estimation. After all, there is still a huge amount of uncertainty when it comes to the Brexit, so even though people are “betting” on a softer Brexit, the reality is we have no idea what’s about to happen.

GBP/JPY  Video 17.01.19

If we do break above the ¥141 level, then we could go looking towards the 200 day  EMA above, and although I wouldn’t like taking the trade, I would probably be forced to be involved at that point. I’m still a very bearish of this pair, especially considering that a lot of global risk is still out there. Remember, this pair under normal circumstances is very risk sensitive, so as long as the US/China situation continues, we could have issues in this pair as well.