Overview
As we can see on the H4 chart, a breakout of minor resistance 187.36 suggested that rebound from 180.36 was resuming. More importantly, the development argues that a correction pattern at 195.86 is completed with three waves down to 180.36. The pair is expected to head towards the next resistance level of 95.86. The breakout of the medium-term trend-line support is taken as a sign of trend reversal. This is supported by bearish divergence condition inthe weekly MACD. Also, GBP/JPY was close to key cluster resistance of 61.8% retracement of 251.09 to 116.83 at 199.80, which is close to the psychological level of 200 . A break of 174.86 will confirm trend reversal and cause a deeper fall to 38.2% retracement of 116.83 to 195.86 at 165.67. In case of another rise, we should be cautious as strong resistance of 199.80/200.00 could finally bring reversal.
Daily Pivots: (S1) 184.94; (P) 186.06; (R1) 187.89;
