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Talking Points:
- GBP/JPY Technical Strategy: Flat
- Support: 184.58, 181.41, 178.85
- Resistance: 186.53, 187.72, 189.70
The British Pound declined as expected against the Japanese Yen after putting in a bearish Evening Star candlestick pattern. Near-term support is at 184.58, the 23.6% Fibonacci retracement, with a break below that on a daily closing basis exposing the 38.2% level at 181.41. Alternatively, a turn above the 14.6% Fib at 186.53 clears the way for a challenge of channel floor support-turned-resistance at 187.72.
Prices are too close to support to justify entering short from a risk/reward perspective. On the other hand, the absence of a defined bullish reversal signal suggests that taking up the long side is premature. With that in mind we will remain flat for now.
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Daily Chart - Created Using FXCM Marketscope
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
