Weekly Report (30 Jan-3 Feb)

gbpjpy30_01_2012

The pair is trading around the previously breached neckline level of the bullish technical pattern at 120.15, where Stochastic is negative and significant on the daily interval, while the SMA 50 formed a strong support level over intraday basis. In general, consolidation above the main resistance of the breached descending channel suggests thatthe upside move remains valid this week, targeting the level of 122.25, which if breached could support the upside correction to extend further. A breach of 120.15 could postpone the awaited incline, while a breach of 118.40 could trigger a downside movement.

The trading range for this week is among the major support at 118.40 and the major resistance at 123.80.

The short-term trend is to the downside as far as 150.00 remains intact targeting 112.00

Previous Report

Support120.25119.65119.10118.40117.95
Resistance121.35121.80122.25122.60123.00
RecommendationBased on the charts and explanations above, our opinion is buying the pair around 120.15, targeting 122.25 and stop loss with 4-hour closing below 119.10 might be appropriate this week