GBP/JPY is expected to prevail its downside movement. The pair accelerated on the downside and is trading below its declining 20-period and 50-period moving averages, which play resistance roles and maintain the bearish bias. The relative strength index is bearish, calling for a further drop.
Hence, as long as 138.55 is not surpassed, a new decline to 137.30 and even to 136.80 seems more likely to occur.
The pair is trading below its pivot point. It is likely to trade in a lower range as long as it remains below the pivot point. Short positions are recommended with the first target at 137.30. A break below this target will move the pair further downwards to 139.40. The pivot point stands at 139.35. If the price moves in the opposite direction and bounces back from the support level, it will move above its pivot point. It is likely to move further to the upside. According to that scenario, long positions are recommended with the first target at 138.85 and the second one at 139.40.
Resistance levels: 138.85, 139.40, and 139.80
Support levels: 137.30,136.80, and 137.00
The material has been provided by InstaForex Company - www.instaforex.com
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