GBP/JPY is now moving within corrective wave 4 of long term downtrend - colored light green in the chart. Within this wave there are A and B subwaves with subwave B from 128.11 still developing (colored magenta in the chart). The latter wave also has its subwaves - A , B and potential C colored red in the chart. Subwave РЎ is still developing from 127.84.
Now the targets of the upmove are Fibonacci retracements of 132.30-124.87, 130.82-124.87, and expansions off 124.87-128.11-126.63.
Resistances:
- 128.55-59-63 = confluence area of .618 and .50 retracements and contracted objective point (COP)
- 129.46 = .618 ret
- 129.87 = objective point (OP)
If the price reverses to the downside the immediate supports will be Fibonacci retracements of 124.87-128.11 and expansions off 139.93-130.26-135.11, 135.11-129.74-132.30, 132.30-124.87-128.11, 128.11-126.63-127.84.
Supports:
- 126.49 = .50 ret
- 126.36 = OP
- 126.11 = .618 ret
- 125.45 = expanded objective point (XOP)
- 124.43 = COP
- 123.97 = super expanded objective point (SXOP)
- 123.61 = XOP
Overbought/Oversold
Assuming that the medium term trend is now up it's preferable to try long positions when the Detrended Oscillator gets below the zero level (25-30 pips below the current prices) or into the oversold area (50-60 pips below the current prices).
Read more on how to apply Fibonacci studies to calculate price targets.
