After dipping to 122.86 initially, GBP/JPY staged a strong rebound last week. The development suggests that rise from 118.82 is noted finished yet and is likely ready to resume. Initial bias remains on the upside this week for 125.82 first. Break will target 127.10 resistance next. The development, with strong momentum also argue that fall from 133.48 might be over at 118.82 already. Break of 127.10 will target a test on 133.48 next. On the downside, break of 122.86 is needed to indicate completion of rebound from 118.82. Otherwise, near term outlook will remain cautiously bullish even in case of retreat.
In the bigger picture, there was so far no impulsive upside move after GBP/JPY formed a medium term bottom at 116.83. On the other hand, there was no sustainable selling neither. The development argues that even though there is no clear sign of trend reversal in GBP/JPY, it's more likely engaging in sideway consolidations, which corrects fall from 163.05. That is, we'd probably see more range trading between 116.83 and 140.02 (50% retracement of 163.05 to 116.83 at 139.94) ahead.
In the longer term picture, fall from 251.09 is treated as resumption of multi decade down trend. Current development gives no indication of medium term reversal yet and GBP/JPY would likely drop towards 100 psychological level on down trend resumption.