GBP/JPY rose further to as high as 153.42 last week but retreated ahead of 153.46 resistance. Initial bias remains neutral this week first. We’re favoring that case that corrective fall from 156.05 has completed at 148.43. Break of 153.46 will resume the rise to retest 156.05 high. Though, break of 151.55 minor support will dampen this bullish view, and turn bias to the downside for 148.43 support.
In the bigger picture, rise from 123.94 is seen as the third leg of the pattern from 122.75 (2016 low). Focus remains on 156.59 resistance (2018 high). Sustained break there should confirm long term bullish trend reversal. Next target is 61.8% retracement of 195.86 (2015 high) to 122.75 at 167.93. On the downside, sustained break of 149.03 support, however, will argue that rise from 123.94 has completed. Further break of 142.71 would open up the bearish case for retesting 122.75 low.
In the longer term picture, the strong break of 55 months EMA was an early sign of long term bullish reversal. Firm break of 156.69 resistance should now confirm the start of an up trend for 195.86 (2015 high).
