GBP/JPY Daily Outlook

Daily Pivots: (S1) 155.57; (P) 157.01; (R1) 159.07; More.

GBP/JPY retreats mildly today but after all, it's still holding on above 157.34 minor support. Another rise is mildly in favor and above 159.58 will target a retest of 162.56 high. On the downside, below 157.34 will flip intraday bias back to the downside for 154.85/94 support zone first. Note that break there will indicate GBP/JPY has completed a head and shoulder reversal pattern and should bring deep decline to test channel support (now at 150.76).

In the bigger picture, medium term rise from 118.81 is treated as correction to the fall from 215.87 and is expected to conclude in 155.88/167.34 resistance zone (38.2% and 50% retracement of 215.87 to 118.81). Break of 154.85 support will starts to argue that such correction has completed at 162.56 already. Sustained trading below channel support (now at 150.34) will add much credence to this case and will likely encourage a retest of 118.81 low at least. However, before that, another rise cannot be ruled out. But after all, we'll continue to look for reversal signal even if such rally will extend.

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