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GBP/JPY 4H Chart 5/10/2012, 10:01 AM EDT

GBP/JPY

The BoE held the benchmark interest rate at 0.50% and did not expand the asset purchase program. Along with a relief against risk aversion, the GBP/JPY is rallying alongside the GBP/USD. The 4H GBP/JPY chart shows a market rallying from the 127.77  wedge support to above 1.29, and above a declining wedge resistance. The bearish scenario is shelved for further medium term consolidation with development of short-term price bullish action.

If the market can hold above the 128.50 level, preferably staying above 129.00, there is upside risk toward the origin of the wedge near 131.70-131.80. Before that, there is going to be challenge against the rally around the 130.00 area. 130.25 is about 61.8% retracement, and also support for the topping pattern that formed under 131.80.

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Fan Yang CMT is the Chief Technical Strategist, trader, educator and a of the main contributors to FXTimes - provider of Forex News, Analysis, Education, Videos, Charts, and other trading resources.

Information and opinions contained in this report are for educational purposes only and do not constitute an investment advice. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness. FXTimes will not accept liability for any loss of profit or damage which may arise directly, indirectly or consequently from use of or reliance on the trading set-ups or any accompanying chart analysis.