Technical analysis of GBP/JPY for October 29, 2014 Market Analysis Review

Fundamental overview:

GBP/JPY is expected to consolidate in a higher range as markets are awaiting Fed's interest rate decision. GBP/JPY is supported by the broadly weaker JPY undertone amid the positive risk sentiment and demand from Japan's importers. But GBP/JPY gains are tempered by Japan's export sales and by sterling sales on buoyant EUR/GBP cross.

Technical comment:
Daily chart is positive-biased as MACD and stochastics are bullish, five-day moving average is above 15-day MA and is advancing.

Trading recommendations:
The pair is trading above its pivot point. It is likely to trade in a higher range as far as it remains above its pivot point. As long as the price is keeping above its pivot point, a long position is recommended with the first target at 174.95 and the second target at 175.90. In an alternative scenario, if the price moves below its pivot points, short positions are recommended with the first target at 173.25. A break of this target would push the pair further downwards and one may expect the second target at 172.90. The pivot point is at 173.75.

Resistance levels:

174.95

175.90

176.75

Support levels:

173.25

172.90

172.55

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