gbpjpy evolving within a short term bearish trend below 144 50145 08 1852332017

Short-term technical outlook on GBP/JPY (Click to enlarge charts) Key technical elements From the 07 Oct 2016 low of 123.04, the on-going medium-term multi-month has […]


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By :  ,  Financial Analyst

Short-term technical outlook on GBP/JPY

GBPJPY_daily (23 May 2017)

GBPJPY_1 hour (23 May 2017)(Click to enlarge charts)

Key technical elements

  • From the 07 Oct 2016 low of 123.04, the on-going medium-term multi-month has stalled at the 147.28 resistance (see daily chart).
  • From the recent 10 May 2017 high of 148.11, the cross pair has started to evolve within a short-term bearish descending channel with the upper boundary at 145.08.
  • The significant short-term resistances stands at 144.50 (pull-back resistance of a broken minor ascending trendline support from 18 May 2017 low) and 145.08 (aforementioned descending channel resistance & 76.4% Fibonacci retracement of the recent slide from 19 May 2017 high to 23 May 2017 low) (see hourly chart).
  • The daily RSI oscillator continues to inch downwards and still has room for further potential downside before it reaches a significant corresponding support at 30%. In addition, the shorter-term 1 hour RSI oscillator remains bearish below its resistances. These observations suggest that downside momentum of price action remains intact.
  • The significant short-term supports rests at 142.46 (0.618 Fibonacci projection from 10 May 2017 high) and 141.77 (Fibonacci cluster and the lower boundary of the aforementioned descending channel).

Key levels (1 to 3 days)

Intermediate resistance: 144.50

Pivot (key resistance): 145.08

Supports: 143.40, 142.46 & 141.77

Next resistance: 146.90/147.28

Conclusion

Therefore, as long as the 145.08 pivotal resistance holds, the GBP/JPY is likely to see a potential decline to retest the 18 May 2017 minor swing low area of 143.40 before targeting the next support at 142.46 with a maximum limit set at 141.77.

However, a clearance above 145.08 may jeopardise the preferred bearish tone to see a push up back towards the medium-term range top of 146.90/147.28.

Charts are from eSignal

Disclaimer

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