There is no doubt that the GBP/JPY has been on a bullish tear of late but there are a couple of signs starting to appear that suggest this pair may be due a bit of a pull back.
G/J monthly: the monthly chart shows that price had stalled at the 50% fib of the major bear move. This fib is near the 184 level which is strong historical S/R in its own right. Note that any bullish breakout above the 50% fib near 184 would suggest a continuation move up to 200 which is the next major fib of 61.8%:
G/J weekly: the weekly chart shows that recent price action now appears to be consolidating within a ‘Broadening Ascending Wedge’ pattern and these are usually bearish patterns. The top of this wedge is aligned with the 50% fib level and so any respect of this 184 region might suggest we could be in for a bit of a pull back:
G/J daily: putting fibs on the most recent bull run shows that a 61.8% pull back would bring price back down to near the mid section of the noted trading channel (179-167):
G/J 4hr: the 4 hr chart shows a possible ‘Double Top’ forming up under the 184 resistance zone.
- the GBP/JPY is consolidating under major 50% fib resistance near 184.
- there are two bearish signals from a 4hr chart ‘Double Top’ and a weekly/monthly chart ‘Broadening Ascending Wedge’.
- Any break and hold above 184 would suggest bullish continuation towards 200 which is near the next major fib of 61.8%.
- Respect of 184 and any pull back would have me looking at the following possible pull back targets: 179, 176 (near the monthly pivot and 50% fib of the recent bull run), 173 and then 167.
- IMHO: 184 is a key demarcation level for this pair.
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