Daily Pivots: (S1) 144.08; (P) 144.40; (R1) 144.62; More
GBP/JPY drops to as low as 143.51 so far today. Break of 144.01 support confirms resumption of fall from 147.76 and intraday bias is now on the downside for trend line support (now at 141.87). Further break there will target 135.58/138.65 support zone. As GBP/JPY is seen as staying in consolidation pattern from 148.42, we’d expect strong support from 135.58 to contain downside. On the upside, break of 146.77 is needed to signal completion of the fall from 147.76. Otherwise, near term outlook will now be cautiously bearish even in case of recovery.
In the bigger picture, rise from medium term bottom at 122.36 is expected to continue to 38.2% retracement of 196.85 to 122.36 at 150.43. Decisive break there will carry long term bullish implications and pave the way to 61.8% retracement at 167.78. In case the sideway pattern from 148.42 extends, we’d be looking for strong support from 135.58 and 50% retracement of 122.36 to 148.42 at 135.39 to contain downside.
