GBP/JPY Technical Analysis: Clearing a Path Toward 185.00?

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Talking Points:

• GBP/JPY Technical Strategy: Flat
• Support: 181.64, 180.18, 178.39
• Resistance: 183.09, 184.88, 187.79

The British Pound is pushing higher for a second consecutive day against the Japanese Yen, with prices on pace to clear a path toward the 185.00 figure. Near-term resistance is at 183.09, the 61.8% Fibonacci retracement, with a break above that confirmed on a daily closing basisexposing the 76.4% level at 184.88. Alternatively, a turn below the 50% Fib at 181.64 clears the way for a challenge of the 38.2% retracement at 180.18.

Entering long seems premature absent confirmation of a resistance break. Furthermore, the correlation between GBPJPY and the S&P 500 stock index warns the pair may sink if risk aversion breaks out following a Greece-focused meeting of Eurozone finance ministers today. With that in mind, we will stand aside.

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Daily Chart - Created Using FXCM Marketscope

--- Written by Ilya Spivak, Currency Strategist for DailyFX.com