GBP/JPY may fall 137 - 205 pips

Our pivot point stands at 185.49.

Our preference

The downside prevails as long as 185.49 is resistance.

Alternative scenario

The upside breakout of 185.49, would call for 186.63 and 187.32.

Comment

The RSI is below 30. It could either mean that the pair is in a lasting downtrend or just oversold and therefore bound to retrace (look for bullish divergence in this case). The MACD is negative and below its signal line. The configuration is negative. Moreover, the price stands below its 20 and 50 period moving average (respectively at 185.16 and 185.69). Finally, the GBP/JPY has penetrated its lower Bollinger band (184.51).

Supports and resistances

187.32 **

186.63 *

185.49 **

185.04

184.44 last

183.07

182.39 **

181.71 *

181.03 **

Number of asterisks represents the strength of support and resistance levels.