GBP/JPY Technical Analysis: Pound Drops to 5-Week Low
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- GBP/JPY Technical Strategy: Flat
- Support: 172.44, 171.75, 170.90
- Resistance: 173.13, 173.98, 174.50
The British Pound is pushing lower as expected against the Japanese Yen after prices put in a bearish Evening Star candlestick pattern. Near-term support is at 172.44, the 50% Fibonacci retracement, with a break above that on a daily closing basis exposing the 61.8% level at 171.75. Alternatively, a reversal back above the 38.2% Fib at 173.13 opens the door for a challenge of the door for a challenge of the 23.6% retracement at 173.983.
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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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.