GBP/JPY is developing medium term downtrend, wave C - colored red in the chart. At this moment wave C has within it subwaves A and B - colored yellow in the chart.
The targets below the current level are Fibonacci retracements of 129.33-133.03 and expansions off 133.03-131.27-132.28.
Supports:
- 130.74 = .618 retracement, the price reversed 1 pip within this level (!)
- 130.52 = objective point (OP)
- 129.43 = expanded objective point (XOP)
If the price keeps going up the nearest resistances will be Fibonacci retracements of 132.28-130.75.
Resistances:
- 131.33 = .382 ret
- 131.51 = .50 ret
- 131.70 = .618 ret
Overbought/Oversold
Assuming that medium term trend is down it's preferable to use overbought readings of the Detrended Oscilaltor with Fib resistances. The overbought area is 15 pips away and that roughly corresponds to 131.33 resistance - this level may be used to consider short positions.
Read more on how to apply Fibonacci studies to calculate price targets.
