Since the beginning of this week, the Pound confidently grew and the GBP/JPY pair managed to gain back most of the Friday’s losses.
Today the growth in the pair continued amid macroeconomic publications from Japan. In particular, the yearly GDP for the second quarter of the year showed an economy contraction by 1.2%, which was still higher than forecasts that predicted a 1.8% decline.
Support and resistance
Bollinger Bands on the daily chart continues falling, while the price range is widening. MACD is turning up and forming a buy signal. Stochastic is in the oversold zone and trying to turn up, which can represent a potential formation of an upward correction in the short-term.
The indicators recommend considering short-term purchases, or waiting for a clearer signal.
Support levels: 182.00, 181.37, 180.39 (4 September low), 180.00.
Resistance levels: 182.46 (local high), 183.23, 185.00, 186.26, 187.32 (end of August highs), 188.56, 189.95 (25 August high).
Open long positions after the breakout of the levels of 182.46, 183.23 (with the appropriate indicators signals) with the target at 185.00 and stop-loss at 181.50.
Short positions can be opened after the breakdown and consolidation below the level of 182.00 with targets at 180.39, 180.00 and stop-loss at 183.00, 183.23.