Forex: GBP/JPY Technical Analysis – March Swing High Exposed
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- GBP/JPY Technical Strategy: Flat
- Support:172.61 (50% Fib exp.), 171.46 (38.2% Fib exp.)
- Resistance: 173.56-75 (Mar 7 high, 61.8% Fib exp.), 175.17 (76.4% Fib exp.)
The British Pound looks poised to extend the longest string of consecutive daily gains in 15 months versus the Japanese Yen after prices cleared resistance at 172.61, the 50%Fibonacci expansion. Buyers now aim to challenge the March 7 high at 173.56, followed by the 61.8% Fib at 173.75. A break above the latter level targets the 76.4% level at 175.17. Alternatively, a reversal back below 172.61 eyes the 38.2% expansion at 171.46.
The space between near-term support and resistance is 95 pips while 20-day ATR is at 128 pips. That suggests the available trading range is too narrow to satisfy acceptable risk/reward parameters given a stop-loss triggered on a daily-closing basis (as is the case with our strategy). With that in mind, we will remain on the sidelines.
Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com