GBP/JPY Technical Analysis: Top Set Below 190.00 Figure?
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- GBP/JPY Technical Strategy: Flat
- Support: 187.80, 186.43, 184.22
- Resistance: 189.70, 191.19, 192.81
The British Pound put in a Bearish Engulfing candlestick pattern, hinting a top against the Japanese Yen may be in place. Near-term support is at 187.80, the 14.6% Fibonacci retracement, with a break below that on a daily closing basis exposing the 23.6% level at 186.43. Alternatively, a turn above the December 5 high at 189.70 opens the door for a challenge of the 38.2% Fib expansion at 191.19.
Risk/reward considerations argue against entering short with prices 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, waiting for an actionable opportunity to present itself.
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Daily Chart - Created Using FXCM Marketscope
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com