Overview:
GBP/JPY is expected to trade in a higher range. It is supported by the positive risk appetite and weak yen sentiment, demand from Japan importers and loose monetary policy of the Bank of Japan. But the GBP/JPY gains are tempered by Japan's exports. Daily chart is mixed as MACD is bearish; but stochastics is turning bullish at oversold zone, bullish outside-day-range pattern was completed on Friday.
Trading recommendation:
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 172.10 and the second target at 172.55. In an alternative scenario, if the price moves below its pivot points, short positions are recommended with the first target at 170.30. A breach of this target will push the pair further downwards and one may expect the second target at 169.60. The pivot point is at 170.80.
Resistance levels:
172.10
172.55
173
Support levels:
170.30
169.60
160
