GBPJPY might be looking to test 139.75 resistance before turning lower again. If bulls are able to break higher, the next hurdle could be around 142.00 mark. Alternately, a break below 138.00 would confirm that a top is in place.
GBPJPY probable wave structure is as follows: The drop from 148.00 through 124.00 was in 3 waves hence corrective. The subsequent rally since then has reached up to 139.75 mark, which is the fibonacci 0.618 retracement of the earlier drop.
It is quite possible that the counter trend is complete at 139.75 or it could extend through 140.50/142.00 levels going further. Either way, we can expect a bearish reversal from current price (139.70/75) or from 140.50/142.00 levels respectively.
Also note that fibonacci 0.786 retracement of the drop between 148.00 through 124.00 is seen through 142.80 levels. A push above 139.75 would encourage GBPJPY to push towards 142.80mark before reversing lower again.
The bearish structure would prevail until prices stay below 148.00 levels, going further. Traders might prepare to sell from current levels or from 142.50/80 mark with protective stops above 145.00 and projected targets below 130.00 at least.
Technical Analysis Team
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