Overview:
GBP/JPY is consolidating with bullish bias. It is supported by positive investor risk appetite, improved euro sentiment after stronger-than-expected Germany November Ifo business sentiment index, soft yen sentiment; demand from Japan importers. But GBP/JPY gains are tempered by Japan exporter sales, profit-taking on yen-shorts. Daily chart is positive-biased as MACD is bullish, stochastics stays elevated in overbought zone; the five-day moving average is above the 15-day MA and advancing.
Trading recommendations:
The pair is trading above its pivot point. It is likely to trade in a higher range as far as it remains above its pivot point. As far as the price is above its pivot point, a long position is recommended with the first target at 165.3 and the second target at 166. In alternative scenario, if the price moves below its pivot point, short positions are recommended with the first target at 163.25, the breach of this target will move the pair further downwards and one may expect the second target at 162.45. The pivot point stands at 164.
Resistance levels:
165.3
166
166.7
Support levels:
163.25
162.45
161.75
