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Talking Points:
- GBP/JPY Technical Strategy: Flat
- Support: 166.17 (23.6% Fib ret.), 163.87 (Feb 4 low)
- Resistance: 167.10-60 (channel bottom, 38.2% Fib ret.), 168.75 (50% Fib)
The British Pound continued to push higher against the Japanese Yen, breaking resistance at 166.17 marked by the 23.6% Fibonacci retracement to expose the underside of a falling channel set from mid-December (now at 167.10). This barrier is reinforced by the 38.2% level 167.60. Pushing above the latter level exposes the 50% Fib at 168.75. Alternatively, a reversal back below 166.17 targets the February 4 low at 163.87.
Risk/reward considerations argue against taking a trade at current levels with prices wedged tightly between relevant near-term support and resistance levels. We will opt to stand aside for now, waiting for the pair to yield a more attractive setup.
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Daily Chart – Created Using FXCM Marketscope 2.0
— Written by Ilya Spivak, Currency Strategist for DailyFX.com