The GBP/JPY pair is developing the wave A of the medium term uptrend from the point 126.48 (royal blue in the chart). Within this wave there are three subwaves (red in the chart) and a potential corrective subwave 4 developing from 131.65.
Now the downside targets are Fibonacci retracements of 126.48-131.65.
Supports:
- 129.68 = .382 retracement
- 129.07 = .50 ret
- 128.45 = .618 ret
If the uptrend resumes the movement and the price breaks above 131.65, the immediate resistances will be Fibonacci expansions 126.48-129.69-128.11, 128.11-131.65-130.15.
Resistances:
- 132.34 = contracted objective point (COP)
- 133.30 = expanded objective point (XOP)
Overbought/Oversold
The bigger wave is now moving upwards, so it is recommended to open the long positions when the Detrended Oscillator goes below the zero level (15-20 pips below the current prices) or into the oversold area (40-50 pips below the current prices). Consider the opportunities of long positions at or near the indicated supports.
