GBP/JPY is developing corrective wave B of medium term uptrend from 133.42 (royal blue in the chart). Within this wave we have three subwaves (magenta in the chart), A, B, and potential impulse subwave C that is developing from 133.32. Within this wave there are three subwaves (red in the chart), and potential impulse subwave C is developing from 133.19.
Now the targets below are Fibonacci retracements of 126.48-133.42, and expansions off 133.42-129.94-133.32, 133.32-130.08-133.19.
Supports:
- 129.95-84 = confluence area of two objective points (OP) and .50 retracement
- 129.13 = .618 ret
- 127.95 = expanded objective point (XOP)
- 127.69 = XOP
If the price reverses to the upside the immediate resistances will be Fibonacci expansions off 126.48-133.42-129.94, 129.94-133.32-130.08, 130.08-133.19-130.71.
Resistances:
- 132.63 = contracted objective point (COP)
- 133.82 = OP
- 134.23 = COP
Overbought/Oversold
The bigger wave is now moving down, so it's preferable to try short positions when the Detrended Oscillator goes above the zero level (current prices) or into the overbought area (30-50 pips above the current prices). Watch for opportunities to go short at or near the indicated resistances.
