Technical analysis of GBP/JPY for October 09, 2014 Market Analysis Review

Fundamental overview:

GBP/JPY is expected to trade in lower range.It is supported by the buoyant EUR/USD and demand from Japan importers. But GBP/JPY gains are tempered by the soft USD/JPY undertone and Japan exporter sales and by sterling sales on buoyant EUR/GBP cross.

Technical comment:
The daily chart is mixed as MACD is bearish but stochastics is turning bullish at oversold zone, bullish outside-day-range pattern was completed on Wednesday.

Trading recommendations:
The pair is trading below its pivot point. It is likely to trade in a lower range as far as it remains below its pivot point. Short position is recommended with the first target at 173.75. A break of this target will move the pair further downwards to 173.45. The pivot point stands at 175. In case the price moves in the opposite direction and bounces back from the support level, then it will moves above its pivot point. It is likely to move further to the upside. In that scenario, a long position is recommended with the first target at 175.45 and the second target at 176.

Resistance levels:

175.45

176

176.65

Support levels:

173.75

173.45

172.95

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