GBP/JPY has developed downwave 135.11-129.74 - according to wave count this is wave A of medium term downtrend, and now we have corrective wave B developing - colored light green in the chart. Within current wave B there are A, B and C subwaves of smaller degree - colored orange red in the chart. The targets of the upmove are Fibonacci retracements of 135.11-129.74, and expansions off 129.74-131.37-130.53.
Resistances:
- 131.79 = .382 retracement
- 132.16 = objective point (OP)
- 132.43 = .50 ret
- 133.06-17 = confluence area of .618 ret and expanded objective point (XOP)
If the price reverses to the downside the immediate supports will be Fibonacci retracements of the wave up from 129.74 - this wave is not developed yet.
Overbought/Oversold
Assuming that the medium term trend is up it's preferable to try long positions when the Detrended Oscillator gets below the zero level (35-40 pips below the current prices) or into the oversold area (65-80 pips below the current prices).
Read more on how to apply Fibonacci studies to calculate price targets.
