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GBP/JPY Technical Analysis: Pound Launches Recovery

GBP/JPY Technical Analysis: Pound Launches Recovery

2014-07-31 00:10:00
Ilya Spivak, Sr. Currency Strategist
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Talking Points:

  • GBP/JPY Technical Strategy: Flat
  • Support: 173.44, 172.59, 171.75
  • Resistance: 173.96, 174.82, 175.35-50

The British Pound launched a recovery against the Japanese Yen having found support below the 173.00 figure. Near-term resistance is at 173.96, the 23.6% Fibonacci expansion, with a break above that on a daily closing basis exposing the 38.2% level at 174.82. Alternatively, a reversal back below the 14.6% Fib at 173.44 opens the door for a challenge of the door for a challenge of the July 23 low at 173.59.

Risk/reward considerations argue against entering short with prices trading in close proximity to support. On the other hand, the absence of a defined bullish reversal signal suggests taking up the long side is premature. We will remain flat for now.

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GBP/JPY Technical Analysis: Pound Launches Recovery

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.

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