FX.co ★ Medium-term forecast of GBP/JPY for July-December, 2014

The pair is enjoying its two and half year bull run. Now it reached the 6-month high at 174.75, the highest level since December 2013. We can see a fresh buying opportunity above the level of 174.75 for an upside target 185.63 with an intermediate strong resistance at the level of 178 (200 months Sma). We strongly recommend buying only above 174.75/175. The monthly RSI is indicating an overbought view and the momentum indicator provides the reason for an upside potential target at 178 and 185 levels. This view is valid with sl 168.30 (200 months Ema). The risk rewards ratio favors to buy on dips. In case the pair breaks below 169.50, we would see 168.30 and 165.50 levels (50 weeks Sma). For the short term, the key support level is at the level of 168 (200 Months Ema) levels.