GBP/JPY gyrated higher last week even though upside momentum wasn’t too convincing as seen in 4 hour MACD. Initial bias stays on the upside this week for retest 142.71 high. On the downside, through, break of 135.87 minor support will argue that rebound from 133.03 has completed. Intraday bias will be turned back to the downside for retesting this support first.
In the bigger picture, rise from 123.94 is seen only as a rising leg of the sideway consolidation pattern from 122.75 (2016 low). As long as 147.95 resistance holds, an eventual downside breakout remains in favor. However, firm break of 147.95 will raise the chance of long term bullish reversal. Focus will then be turned to 156.59 resistance for confirmation.
In the longer term picture, repeated rejection by 55 month EMA indicate long term bearishness in the cross. Down trend from 251.09 (2007 high) should eventually resume through 122.75 to 116.83 (2011 low) and below. However, sustained break of 55 month EMA (now at 144.42) will dampen this view and could open up further rise back to 195.86 (2015 high).
