Potential Rebound for British Pound vs Japanese Yen?

Posted on Posted in Currencies & Forex

currency-symbolsAt some point this has to end badly. Below is a 20-year monthly chart of the British Pound vs Japanese Yen (GBP/JPY). As one can see, it has sold off severely since the Brexit decision and could very well be on its way to completing a full 100% bearish Fibonacci retracement. (See chart below)

Of course what goes down must come up (eventually at some point in time). If the GBP/JPY looks like it will hold support near a bottom, then traders could have a potentially favorable risk-to-reward trading opportunity. I have provided monthly pivots for July-2016 as a guide for some potential trading levels.

No recommendation is being given here, but I thought this post would be most useful to anyone of a contrarian mindset such as mine. The safe haven trade has become pretty crowded and will correct to the upside at some point. 

 

pound-vs-yen-monthly-july-2016
Click to enlarge

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