GBP/JPY’s rebound from 131.51 tried to extend last week after brief retreat. But it’s limited below 139.88 key resistance so far. Initial bias remains neutral this week first. For now, we’d still expect strong resistance from 139.88 to limit upside. On the downside, break of 137.35 minor will turn bias to the downside for retesting 131.51 low. However, firm break of 139.88 will extend the rebound to 143.93 resistance next.

In the bigger picture, corrective medium term rise from 122.36 (2016 low) has completed at 156.69 already. That came after failing to break through 55 month EMA. Fall from 156.59 (2018 high) is seen as resuming the long term down trend from 195.86 (2015 high). Below 131.51 will target 122.36 low first. And this will now remain the preferred case as long as 139.88 support turned resistance holds. Sustained break of 139.88 will mix up the outlook and we’ll reassess on the final structure of the rebound from 131.51.

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In the longer term picture, rejection by 55 month EMA is seen as a bearish signal. And fall from 195.86 (2015 high) should still be in progress. Break of 122.26 should confirm this bearish case and send GBP/JPY through 116.83 low.

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