The GBP/JPY pair is developing the corrective wave B of the medium term uptrend from 133.42 (royal blue in the chart). Within this wave we have two subwaves (magenta in the chart) A, and B that is developing from 129.94 comprising three subwaves (red in the chart) and a potential impulse subwave C developing from 130.08. It contains subwaves A, B, and C (orange red) with subwave C still developing from 130.58.
The upside targets are Fibonacci expansions 126.48-133.42-129.94, 129.94-133.32-130.08, 130.08-131.57-130.58 and retracements 133.32-130.08.
Resistances:
- 133.46 = objective point (OP)
- 134.23 = contracted objective point (COP)
- 134.48 = super expanded objective point (SXOP)
The donside targets below are Fibonacci retracements 126.48-133.42, 130.08-133.19 and expansions 133.42-129.94-133.32, 133.32-130.08-133.19.
Supports:
- 132.00 = .382 retracement
- 131.63 = .50 ret
- 131.27 = .618 ret
- 129.95 = .50 ret and OP
- 129.84 = OP
- 129.13 = .618 ret
Overbought/Oversold
The bigger wave is now moving down, so it is recommended to try short positions when the Detrended Oscillator goes above the zero level (35-40 pips above the current prices) or into the overbought area (70-85 pips above the current prices). Watch for opportunities to go short at or near the indicated resistances.
Read more on how to trade with Fibonacci levels.