The corona virus has hit the financial markets hard and the currencies are of course no exception. GBP/JPY has been under more pressure than first expected and is now headed towards the 78.6% corrective target at 131.12. The last part of the decline is being followed by a clear loss of downside momentum indicating a bottom will be seen soon.
Short-term we will be looking for the completion of wave 2/ near 131.12 or upon a break above minor resistance at 132.66 as the first indication that a low already has been seen, while a break above resistance at 133.62 confirms the low is in place.
R3: 133.62
R2: 132.86
R1: 132.66
Pivot: 132.49
S1: 132.17
S2: 131.85
S3: 131.63
Trading recommendation:
We will buy GBP at 131.35 or upon a break above 132.66
