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Talking Points:
- GBP/JPY Technical Strategy: Flat
- Support: 180.69, 177.70, 175.84
- Resistance: 182.55, 183.69, 185.54
The British Pound continued to race upward against the Japanese Yen after last week’s BOJ stimulus expansion, hitting the highest level in four years. Near-term resistance is at 182.55, the 114.6% Fibonacci extension, with a break above that on a daily closing basis exposing the 123.6% level at 183.69. Alternatively, a reversal below resistance-turned-support at 180.69, the September 19 high, clears the way for a challenge of the 76.4% Fib retracement at 177.70
Prices are too close to resistance to justify entering long from a risk/reward perspective. On the other hand, the absence of a defined bearish reversal signal suggests that taking up the short side is premature. With that in mind we will remain flat for now.
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Daily Chart – Created Using FXCM Marketscope 2.0
— Written by Ilya Spivak, Currency Strategist for DailyFX.com