GBP/JPY is moving in correction to medium term downtrend. Now we have corrective subwave B (colored red in the chart) within impulse wave C of medium term downtrend - colored magenta in the chart.
Now, the immediate resistances are Fibonacci retracements of 136.36-139.90, 139.93-132.90, and expansions off 132.90-134.43-133.68, 133.68-134.75-134.07.
Resistances:
- 135.41 = .618 retracement
- 135.80 = expanded objective point (XOP)
- 136.16 = XOP
- 136.42 = .50 retracement
- 136.87 = super expanded objective point (SXOP)
- 137.24 = .618 ret
- 137.69 = SXOP
If the downtrend resumes the immediate supports will be Fibonacci retracements of the wave up from 132.90 - this wave is not developed yet.
Overbought/Oversold
Assuming that the wave of a larger degree is moving up it's preferable to open long positions when the Detrended Oscillator gets below the zero level (20-30 pips below the current prices) or into the oversold area (55-75 pips below the current prices).
Read more on how to apply Fibonacci studies to calculate price targets.
