Technical analysis of GBP/JPY for May 21, 2015 Market Analysis Review

Fundamental outlook:
GBP/JPY is expected to consolidate with bullish bias. It is underpinned by the buoyant USD/JPY undertone and demand from Japan importers. But GBP/JPY upside is limited by weak euro sentiment, diminished investor risk appetite and Japan export sales.

Technical comment:
The daily chart is negative-biased as stochastics is falling from overbought levels, the MACD staged bearish crossover against its exponential moving average.

Trading recommendations:
The pair is trading above its pivot point. It is likely to trade in a wider range as long as it remains above its pivot point. As long as the price holds above its pivot point, long positions are recommended with the first target at 190.60 and the second target at 191.20. In the alternative scenario, short positions are recommended with the first target at 187.90 if the price moves below its pivot points. A break of this target is likely to push the pair further downwards, and one may expect the second target at 187.06. The pivot point is at 188.60.

Resistance levels:
190.60
191.20
191.85

Support levels:
187.90
187.06
186.35

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