The GBP/JPY is trading within corrective wave B against 131.14-135.19 - colored magenta in the chart. Within this wave there are A-B waves of smaller degree - colored red in the chart. Subwave B is still developing. And the targets of the upmove are Fibonacci retracements of 135.19-132.97, and expansions off 132.97-133.70-133.20, 131.14-135.19-132.97.
Resistances:
- 133.93 = objective point (OP)
- 134.08 = .50 retracement
- 134.34-38 = confluence area of .618 ret and expanded objective point (XOP)
- 135.11 = super expanded objective point (SXOP)
- 135.47 = contracted objective point (COP)
If the downtrend resumes the immediate supports will be Fibonacci retracements of 131.14-135.19.
Supports:
- 132.69 = .618 retracement
Overbought/Oversold
Assuming that the price is developing a corrective wave it's preferable to stand aside until an impulse wave manifests itself. According to the Detrended Oscillator the oversold area lies 20-30 pips below the current price, and the overbought is 25-35 pips above the current level.
Read more on how to apply Fibonacci studies to calculate price targets.
