GBP/JPY is developing corrective wave B (colored light green in the chart) of medium term downtrend from 119.31. Within this wave there are A, B, and C subwaves (colored royal blue in the chart), with subwave РЎ still developing from 120.23. Within the latter there are 5 subwaves (colored red in the chart). The targets of the upmove are Fibonacci retracements of 127.25-119.31, and expansions off 119.31-122.64-120.23, 120.23-121.08-120.36, 120.36-122.52-121.92.
Resistances:
- 123.25-28 = confluence area of contracted objective point (COP) and .50 retracement
- 123.56 = objective point (OP)
- 124.08 = OP
- 124.22 = .618 ret
If the price reverses to the downside the immediate supports will be Fibonacci retracements of 120.23-122.71.
Supports:
- 121.76 = .382 retracement
- 121.47 = .50 ret
- 121.18 = .618 ret
Overbought/Oversold
Assuming that the major wave is now moving up it's preferable to try long positions when the Detrended Oscillator gets below the zero level (current prices) or into the oversold area (10-20 pips below the current prices), watch for entries long at the specified supports.
