GBP/JPY Technical Analysis: Candle Setup Hints at Rebound
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- GBP/JPY Technical Strategy: Flat
- Support: 182.81, 181.46, 180.14
- Resistance: 183.67, 186.18, 187.31
The British Pound may be readying to launch a recovery against the Japanese Yen after prices put in a Bullish Engulfing candlestick pattern. Near-term resistance is at 183.67, the 23.6% Fibonacci expansion, with a break above that on a daily closing basis exposing the 38.2% level at 185.06. Alternatively, a turn below the 14.6% Fib at 182.81 clears the way for a challenge of a horizontal pivot at 181.46.
Risk/reward considerations argue against entering long with prices in close proximity to resistance. On the other hand, the absence of a defined bearish reversal signal suggests taking up the short side is premature. We will remain flat for now, waiting for a more actionable opportunity to present itself.
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Daily Chart - Created Using FXCM Marketscope
--- 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.