23.10.201416:50 Forex Analysis & Reviews: Technical analysis of GBP/JPY for October 23, 2014

Fundamental overview:

GBP/JPY is expected to trade in a higher range. It is undermined by the bullish GBP sentiment and by sterling demand on soft EUR/GBP cross. GBP/JPY gains are tempered by the dovish October Bank of England MPC meeting minutes showing the committee split 7-2 in favor of keeping rates on hold, with the majority far from convinced for an early rate increase.

Technical comment:
Daily chart is negative-biased as MACD is bearish, stochastics is reverting to bearish mode ,five and 15-day moving averages declining.

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 and the second target at 174.95. In an alternative scenario, if the price moves below its pivot points, short positions are recommended with the first target at 171. A break of this target would push the pair further downwards and one may expect the second target at 170.20. The pivot point is at 172.05.

Resistance levels:
174
174.95
175.65
Support levels:
171
170.20
169.75