GBP/JPY Technical Analysis – Pound Drops for Fourth Day
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- GBP/JPY Technical Strategy: Flat
- Support: 173.00, 172.34, 171.80
- Resistance: 173.41, 174.08, 174.60
The British Pound declined as expected against the Japanese Yen after prices put in a Shooting Star candlestick near the 174.00 figure. Sellers are testing support in the 172.79-173.00 area, marked by a formerly broken triple top and the 23.6% Fibonacci retracement. A daily close below this barrier targets the 172.34-53 area, marked by the 38.2% level and the bottom of a rising channel set from late May. Alternatively, a reversal higher through the 14.6% Fib at 173.42 opens the door for a test of the June 20 high at 174.08.
Prices are too close to support to justify entering short from a risk/reward perspective. Alternatively, the absence of a defined bullish reversal signal argues against taking up the long side. We will remain flat for now, waiting for an actionable opportunity to present itself.
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Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.