04.03.201417:56 Forex Analysis & Reviews: Technical analysis of GBP/JPY for March 04, 2014

Long-term review

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Overview:

GBP/JPY is expected to trade in higher range. It is undermined by the increased investor risk aversion as Russia-Ukraine tensions persist and Japan exporter sales. But GBP/JPY losses are tempered by the diminished expectations for ECB rate cut on Thursday after higher-than-expected euro-zone February flash CPI, demand from Japan importers and loose BOJ's monetary policy. Daily chart is negative-biased as stochastics is falling from overbought zone and MACD is staging bearish crossover against its exponential moving average, five-day moving average is falling below 15-day MA.

Trading recommendation:

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 far as the price is above its pivot point, a long position is recommended with the first target at 170.6 and the second target at 171.2. In an alternative scenario, if the price moves below its pivot points, short positions are recommended with the first target at 168.75. A breach of this target will push the pair further downwards and one may expect the second target at 168.35. The pivot point is at 169.20.

Resistance levels:
170.6
171.2
171.6

Support levels:
168.75
168.35
167.9

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