Forex: GBP/JPY Technical Analysis – Looking for Direction Cues
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- GBP/JPY Technical Strategy: Flat
- Support: 169.28 (23.6% Fib exp.), 167.68 (38.2% Fib exp.)
- Resistance: 171.56 (trend line), 173.63 (Jan 23 high)
Prices are stalling below trend line set from early January, with a Shooting Star candlestick hinting the British Pound may be carving out a top against the Japanese Yen. A break below initial support is at 169.28, the 23.6% Fibonacci expansion, exposes the 38.2% level at 167.68. Alternatively, a push above the trend line (now at 171.56) targets the January 23 high at 173.63.
Seven back-to-back indecision candles hint at ebbing bullish momentum but fall short of offering firm confirmation of reversal. Risk/reward considerations are also skewed against taking a trade with prices trading too close to relevant support. We will continue stand aside for now.
Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com