GBP/JPY Outlook (Week of March 5th)
by Himanshu Jain
GBPJPY had found some resistance slightly below 130.00 psychological level but after dropping down to 126.69, the pair jumped upward strongly to break the 130.00 resistance and closed down for the week at 129.55.
For the next week initially we may see some sideways movement below 130.20 but a break of that level should bring further upward gains towards 131.15 which is Fibonacci 61.8% retracement of the downward move during April 8th, 2011 to September 22nd, 2011. Any firm break over 131.20 should target the next resistance near 134.50.
Though it is not expected but in case any downward correction makes GBPJPY to break below the recent 126.68 (which will also represent a break below 22-day EMA) then we would expect a support at the Kijun line level of daily Ichimoku cloud i.e. near 125.85 and any break below 125.80 should target further correction towards 124.20/124.30 which is the current 55-day EMA. But is such cases also we would expect an upward rebound.
Please note that even with the above outlook, our overall outlook is not bullish and we remain in favor of another fall from one of the mentioned resistance levels.
You may like to check daily technical analysis of GBP/JPY and also the longer-term forecast of GBP/JPY pair. You may also share your views at Forex Forum.
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