GBPJPY bulls have managed to print a marginal high around 140.30 levels yesterday. Please note that the currency still remains within the vicinity of fibonacci 0.618 retracement of earlier drop between 148.00 and 124.00 and is expected to correct towards 130.00 at least.
GBPJPY probable wave counts are as follows: The drop between 148.00 and 124.00 was corrective A-B-C (not labelled here). Also note that the drop could be a part of larger degree diagonal structure that might be complete at 124.00
If the above proposed wave counts hold well, GBPJPY should be on its way to print above 148.00, going in the near term. Alternately, if GBPJPY fails to push through 142.85 mark, which is fibonacci 0.786 retracement of the above drop, it could reverse sharply lower to 130.00 levels.
Either way, a corrective drop from 1340.00 levels could be due, if not a bearish reversal. The drop could push prices lower towards 130.00 mark before finding support. GBPJPY could resume its rally thereafter.
Traders might remain inclined to initiate fresh short positions around 140.00 mark, with protective stops around 142.80 levels. The projected targets are pointing towards 130.00 levels if not lower. Only a consistent break above 143.00 would threaten to push towards 148.00.
Technical Analysis Team
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