Fundamental Overview:
GBP/JPY is expected to trade in a higher range. It is supported by the weak yen sentiment and demand from Japanese importers. But GBP/JPY gains are tempered by Japanese export sales, worries about Scotland potentially becoming independent and its implications on the U.K. economy, raising question about whether the uncertainty could delay the first Bank of England rate increase and sterling sales on buoyant EUR/GBP cross.
Technical Comment:
The daily chart mixed as MACD & stochastics bearish, but five- & 15-day moving averages meandering sideways.
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 171.75 and the second target at 172.35. In an alternative scenario, if the price moves below its pivot points, short positions are recommended with the first target at 169.25. A break of this target would push the pair further downwards and one may expect the second target at 168.55. The pivot point is at 170.25.
Resistance levels:
171.75
172.35
172.75
Support levels:
169.25
168.55
168.15
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