GBP/JPY surged to as high as 153.84 last week as rebound from 144.97 extended. As a temporary top is likely formed, initial bias is neutral this week first. On the upside, above 153.83 will target 156.69 high. However, break of 150.58 will suggests that such rebound from 144.97 has completed and bring retest of this support.
In the bigger picture, price actions from 156.59 are viewed as a corrective pattern. For now, we’d expect at least one more fall for 38.2% retracement of 122.36 to 156.59 at 143.51 before the consolidation completed. Though, firm break of 156.59 will resume whole up trend from 122.36 (2016 low) to 50% retracement of 195.86 (2015high) to 122.36 at 159.11 next.
In the longer term picture, current development suggests that rise from 122.36 (2016 low) is not completed yet. Such rally could extend to 61.8% retracement of 195.86 (2015high) to 122.36 at 167.78 before completion. This will now be the preferred case as long as 139.29 support holds.
