GBP/JPY is now developing corrective wave 4 of the medium term uptrend - colored red in the chart. The targets of wave 4 are Fibonacci retracements of 129.43-132.99, 129.51-132.99 and expansions off 132.99-132.38-132.90.
Supports:
- 131.66-63 = .618 retracements
- 131.30-25-21 = confluence area of super expanded objective point and .50 retracements
- 130.84-79 = .618 retracements
If the price reverses up the nearest resistances before 132.99 is broken will be retracements of the downwave from 132.99 (not developed yet) and if the price breaks above 132.99 the nearest resistance will be the expansion off 129.33-131.74-129.43.
Resistance:
- 133.33 = expanded objective point (XOP)
Overbought/Oversold
Assuming that the prevailing trend is going up it's preferable to use the Detrended Oscillator's oversold readings and in conjunction with Fib supports. Oversold area is 15-25 pips below the current price and there are some Fib supports to watch.
Read more on how to apply Fibonacci studies to calculate price targets.
