GBP/JPY Technical Analysis: Waiting to Confirm Topping

To receive Ilya's analysis directly via email, please SIGN UP HERE

Talking Points:

• GBP/JPY Technical Strategy: Flat
• Support: 187.80, 186.43, 184.22
• Resistance: 190.00, 191.36, 193.57

The British Pound may be carving out a top against the Japanese Yen after putting a Bearish Engulfing candlestick pattern. A daily close below the 14.6% Fibonacci retracement at 187.80 exposes the 23.6% level at 186.43. Alternatively, a reversal above the 189.70-190.00 area (December 5 high, 14.6% Fib expansion) clears the way for a test of the 23.6% threshold at 191.36.

Positioning is inconclusive at this point absent confirmation of a bearish reversal, arguing against taking up the short side for the time being. We will continue to remain on the sidelines, waiting for a more compelling opportunity to present itself.

Add these technical levels directly to your charts with our Support/Resistance Wizard app!

Daily Chart - Created Using FXCM Marketscope

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