GBPJPY – As highlighted in our weekly analysis of the possibility of a further upside strength, well that has occurred pushing the cross through its Feb 18’2011 high at 135.47 on Monday and following through during Tuesday trading session.
With this technical development, GBPJPY now faces the risk of strengthening further in the days ahead with eyes on the 140.57 level, its May 10’2010 high. The cross may face price hesitation at that level as it is within the vicinity of its psycho level at 140.00.
However, if that zone is firmly violated, we should see further strength building up towards the 142.73 level, representing its .618. Fib Ret (163.04-122.40) and possibly higher targeting the 145.95 level. Its daily and weekly RSI is bullish and pointing higher supporting this view.
Alternatively, on any pullback from here, the 135.47 level will be targeted where a reversal of roles is support is expected to occur and then turn the cross back up. Below that level if seen will call for more weakness towards the 132.95 level and then the 130.00 level.
Photo: Mohammed Isah