The GBP/JPY has stalled in wave C of medium term uptrend (colored magenta in the chart). Now corrective subwave B is developing (colored red). Still, the targets of the upmove are Fibonacci expansions off 125.47-129.41-128.29, 128.29-131.40-130.43, 130.43-131.82-130.96.
Resistances:
- 131.82 = contracted objective point (COP)
- 132.23 = objective point (OP)
- 132.35 = confluence area of COP and OP
- 133.21 = expanded objective point (XOP)
- 133.54 = OP
If the price reverses down the nearest supports will be Fibonacci retracements of 130.43-131.82, 128.29-131.82.
Supports:
- 130.96 = .618 ret, hit precisely (!)
- 130.47 = .382 ret
- 130.06 = .50 ret
- 129.64 = .618 ret
Overbought/Oversold
Assuming that the medium term trend is up it's preferable to take oversold readings of the Detrended Oscillator to consider long positions. The oscillator is now above the zero level, therefore the current price is not suitable for long positions. Now it's better to wait until the price retraces in the oversold area (15 pips away) to consider long positions.
Read more on how to apply Fibonacci studies to calculate price targets.
