GBP/JPY is developing corrective subwave B from 128.19 (colored royal blue in the chart) that is part of impulse wave C of long term downtrend (from 132.30). Now within this wave B there are A, B and C subwaves of still smaller degree - colored magenta in the chart. Subwave C is still developing from 128.40. The targets of the upmove are Fibonacci retracements of 132.30-128.19, and expansions off 128.19-130.06-128.40, 128.40-129.88-129.03.
Resistances:
- 130.25-27 = confluence area of .50 retracement and objective point (OP)
- 130.51 = OP
- 130.73 = .618 ret
If the price reverses to the downside the immediate supports will be Fibonacci expansions off 139.93-130.26-135.11, 135.11-129.74-132.30, 132.30-128.19-130.06, 130.06-128.40-130.05.
Supports:
- 129.02 = COP
- 128.39 = OP
- 127.52 = COP
- 127.36 = expanded objective point (XOP)
- 126.93 = OP
Overbought/Oversold
Assuming that the medium term trend is down it's preferable to try short positions when the Detrended Oscillator gets above the zero level (15-20 pips above current prices) or into the overbought area (45-60 pips above the current prices).
Read more on how to apply Fibonacci studies to calculate price targets.
