GBP/JPY is expected to trade in a lower range as the bias remains bearish. Currently trading at 157.70, the pair has posted a pullback but remains below its resistance at 158.35. Even though a continuation of the consolidation cannot be ruled out, its extent should be limited. The bias remains bearish, and a new down leg is expected with the next target set at 156.70. However, if the pair continues its consolidation and breaks below the horizontal support at 156.70, it would open the way to further weakness toward 156.30.
Trading Recommendations:
The pair is trading below its pivot point. It is likely to trade in a lower range as long as it remains below the pivot point. Short positions are recommended with the first target at 156.70. A break of this target will move the pair further downwards to 156.30. The pivot point stands at 158.35. In case the price moves in the opposite direction and bounces back from the support level, it will move above its pivot point. It is likely to move further to the upside. According to that scenario, long positions are recommended with the first target at 159.10 and the second target at 159.50.
Resistance levels: 159.10, 159.50, 160.35
Support levels: 156.70, 156.30, 155.35
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