The GBP/JPY is developing corrective wave B against 131.14-135.19 - colored magenta in the chart. Within this wave there are A-B-C waves of smaller degree - colored orange red in the chart. Subwave C is still developing. And the targets of the downmove are Fibonacci retracements of 131.14-135.19, and expansions off 135.19-133.52-134.12.
Supports:
- 132.69 = .618 retracement
- 132.45 = objective point (OP)
- 131.42 = expanded objective point (xOP)
If the price reverses up the immediate resistances will be Fibonacci retracements of 135.19-132.97, and expansions off 131.14-135.19-132.97.
Resistances:
- 133.82 = .382 retracement
- 134.08 = .50 ret
- 134.34 = .618 ret
- 135.47 = contracted objective point (COP)
Overbought/Oversold
Assuming that medium term trend is down it's preferable to use overbought condition of the Detrended Oscillator (current prices plus 20-35 pips) or its cross above the zero level (current prices) to consider short positions.
Read more on how to apply Fibonacci studies to calculate price targets.
