The GBP/JPY is now developing corrective wave 4 of medium term uptrend (colored royal blue in the chart). The targets of wave 4 are Fibonacci retracements of 131.62-135.56 (wave 3), 133.24-135.56 (subwave C within wave 3), and expansions off 135.56-134.75-135.54.
Supports:
- 134.13 = .618 retracement, hit precisely (!)
- 134.05 = .382 ret
- 133.59 = .50 ret
- 133.42 = super expanded objective point (SXOP)
- 133.13 = .618 ret
If the price reverses up the immediate resistances will be Fibonacci retracements of 135.54-134.13, and if the price goes above 135.56, we'll use Fibonacci expansions off 129.49-132.64-129.75, 129.75-133.31-131.62, 131.62-135.56-134.13.
Resistances:
- 136.50-56 = confluence area of objective point (OP) and contracted objective point (COP)
- 137.38 = expanded objective point (XOP)
Overbought/Oversold
Assuming that the medium term trend is up, but now a corrective wave is developing, it's preferable to stand aside, until wave 5 manifests itself.
Read more on how to apply Fibonacci studies to calculate price targets.