GBP/JPY Technical Analysis: Candle Setup Hints at Bounce
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- GBP/JPY Technical Strategy: Flat
- Support: 178.44, 176.31, 174.80
- Resistance: 180.47, 181.86, 182.98
The British Pound may be preparing to turn higher against the Japanese Yen after prices put in a bullish Piercing Line candlestick pattern. A daily close above the 23.6% Fibonacci expansion at 180.47 exposes the 181.58-86 area (support-turned-resistance, 38.2% level). Alternatively, a push below rising trend line support at 178.44 opens the door for a test of triple bottom support at 176.31.
Prices are too close to resistance to justify entering long from a risk/reward perspective. On the other hand, the absence of a defined bearish reversal signal suggests that taking up the short 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