GBP/JPY is developing potential impulse wave РЎ (colored royal blue in the chart) of medium term downtrend from 127.31. Within this wave there are A, B and C subwaves (colored magenta in the chart) with subwave C still developing from 126.55. And the latter also has its A, B and C subwaves (colored red in the chart) with subwave C still developing from 125.33.
The targets of the downmove are Fibonacci expansions off 130.81-123.27-127.31, 127.31-124.47-126.55, 126.55-124.26-125.33.
Supports:
- 123.91 = contracted objective point (COP)
- 123.71 = objective point (OP)
- 123.04 = OP
- 122.65 = COP
- 121.95 = expanded objective point (XOP)
If the price reverses to the upside the immediate resistances will be Fibonacci retracements of 126.55-124.11.
Resistances:
- 125.04 = .382 retracement
- 125.33 = .50 ret
- 125.62 = .618 ret
Overbought/Oversold
Assuming that the major wave is down it's preferable to try short positions when the Detrended Oscillator gets above the zero level (5-10 pips above the current prices) or into the overbought area (20-30 pips above the current prices).
Read more on how to apply Fibonacci studies to calculate price targets.
