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- GBP/JPY Technical Strategy: Short at 172.26
- Support: 171.27 (23.6% Fib ret.), 169.86 (38.2% Fib ret.)
- Resistance:172.55 (trend line), 172.82
The British Pound appears vulnerable to losses against the Japanese Yen after sellers overcame rising trend line support set from early February. Prices corrected upward from the 23.6% Fibonacci retracement at 171.27 to re-test the trend line (now at 172.55). A break above this boundary initially targets a horizontal barrier dating back to early March at 172.82. Alternatively, a reversal through support exposes the 38.2% level at 169.86.
We entered short GBPJPY at 172.26 and will continue to hold the position, aiming for 171.27 as an initial objective. A stop-loss will be activated on a daily close above 172.82. We will take profit on half of the trade at the first target and trail the stop-loss to the breakeven level.
Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com