GBP/JPY Technical Analysis: Down Trend Ready to Resume?

By DailyFx | August 27, 2014 AAA

DailyFX.com -

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

Talking Points:

  • GBP/JPY Technical Strategy: Flat
  • Support: 171.87, 171.15, 170.56
  • Resistance: 172.95, 174.20, 175.35

The British Pound may be on the verge of resuming its down trend against the Japanese Yen following the formation of a Bearish Engulfing candlestick pattern. Near-term support is at 171.87, 23.6% Fibonacci expansion, with a break below that on a daily closing basis exposing the 38.2% level at 171.15. Alternatively, a turn above a falling trend line set from early July at 172.95 opens the door for a test of the July 30 high at 174.20.

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.

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

GBP/JPY Technical Analysis: Down Trend Ready to Resume?

Daily Chart - Created Using FXCM Marketscope 2.0

comments powered by Disqus
Related Forex Analysis
  1. USD/JPY crashes below 106.50, more downside in store
    Forex News

    USD/JPY crashes below 106.50, more downside in store

  2. Trading Video: Is the S&P 500 Rebound, VIX Retreat a Trend or Interlude
    Forex News

    Trading Video: Is the S&P 500 Rebound, VIX Retreat a Trend or Interlude

  3. EUR/USD bulls wake up and drive pair above 1.2800
    Forex News

    EUR/USD bulls wake up and drive pair above 1.2800

  4. Strategy Video: Which is the Better Breakout Candidate - AUDUSD or EURJPY?
    Forex News

    Strategy Video: Which is the Better Breakout Candidate - AUDUSD or EURJPY?

  5. AUD/USD Range Endures With Clearer Cues From Candlesticks Desired
    Forex News

    AUD/USD Range Endures With Clearer Cues From Candlesticks Desired

Trading Center