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Talking Points:
- GBP/JPY Technical Strategy: Flat
- Support: 174.34, 172.85, 170.69
- Resistance: 175.84, 177.70, 180.69
The British Pound stalled ahead of the 175.00 figure against the Japanese Yen after rising to a three-week high. A daily close above the 61.8% Fibonacci retracementat 175.84 exposes the 76.4% level at 177.70. Alternatively, a reversal below the 50% Fib at 174.34 opens the door for a test of the 38.2% retracement at 175.85.
Positioning is inconclusive at this point. On one hand, upward continuation is in question considering the negative response from risk appetite – an important driver of GBPJPY – following the FOMC policy announcement. On the other, the absence of a defined bearish reversal signal hints taking up the short side is premature. We will remain flat for now.
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Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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