Forex Technical Update

Previous: GBP/JPY Rallies Above 124.00; 125.50-125.80 Resistance in Sight (8/16)

GBP/JPY Day Chart 8/21/2012 9:25AM EDT
"GBP/JPY

GBP/JPY is rallying on the back of this week's risk-on trading so far, which weakened the safe haven currencies USD and JPY across the board. The GBP/JPY is indeed closing in on the 125.50-125.80 resistance area noted in the previous update. Here we have a declining trendline seen in the daily chart, going back to the highs from March-April near 133.50. The RSI reading in the daily chart is breaking 60 and showing loss of the bearish momentum established by the April through May decline.

A break above 125.80 opens up 127-127.10 pivot. There is a swing projection to 127.30 as well. This bullish outlook can become more clear if there is a throwback that holds above the pivot area between124.80 and 125.00, seen more celarly in the 4H chart. A more aggressive outlook puts the next pivot around the 130.00 handle in sight.

GBP/JPY Daily Chart 8/21/2012 9:35AM EDT

"GBP/JPY

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

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