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GBP/JPY is developing potential impulse wave C (colored light green in the chart) from 122.71. On smaller timeframes this wave has A, B and C subwaves of smaller degree (colored red in the chart) with subwave C still developing from 122.21. We calculate the targets below using Fibonacci expansions off 127.25-119.31-122.71, 122.71-121.54-122.21.
Long term supports:
- 119.15 = super expanded objective point (SXOP)
- 117.80 = contracted objective point (COP)
If the price keeps retracing after yesterday's decline the immediate resistances will be Fibonacci retracements of 122.21-120.01, 122.71-120.01.
Resistances:
- 120.85 = .382 retracement
- 121.04-11 = .382 and .50 retracements
- 121.36-37 = .50 and .618 retracements
- 121.68-74 = .618 and .786 retracements
Overbought/Oversold
Assuming that the major wave is now moving down it's preferable to try short positions when the Detrended Oscillator gets above the zero level (5-10 pips above the current prices) or into the overbought area (30-40 pips above the current prices), watch for entries short at the indicated supports.
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