GBP/JPY has developed daily wave A 126.43-131.99. Current wave down is considered corrective B until 126.43 is broken to the downside. The targets of the downmove are Fibonacci retracements of 126.43-131.99 (daily wave A), and 127.96-131.99 (subwave C within daily A).
Supports:
- 129.97-87 = confluence area of .50 and .382 retracements, reached already (!)
- 129.50 = .618 ret
- 129.21 = .50 ret
- 128.55 = .618 ret
If the price resumes the uptrend the nearest resistances will be Fibonacci retracements of 131.99-129.82.
Resistances:
- 130.91 = .50 ret, reached already (!)
- 131.16 = .618 ret
Overbought/Oversold
The Detrended Oscillator is making higher peaks above the zero level which corresponds to a wave of the same degree as 131.99-129.82. Until 131.99 is broken to the upside the upmove will be considered corrective wave B (colored red in the chart) and good for initiating short positions. Therefore Fib resistances or the overbought area (30-40 pips above the current price) are the levels to watch.
Read more on how to apply Fibonacci studies to calculate price targets.
