GBP/JPY stayed in right range above 142.16 last week and outlook is unchanged. Initial bias remains neutral this week first. Rise from 122.36 is seen as a corrective move. Below 142.16 will affirm the case that it’s completed at 148.42. In that case, intraday bias will be turned to the downside for 55 day EMA (now at 140.43) and below. Break of 148.42 will extend the rise from 122.36. But we’d expect strong resistance from 150.43 long term fibonacci level to limit upside.
In the bigger picture, the down trend from 195.86 top (2015 high) should have made a medium term bottom at 122.36 after hitting 100% projection of 195.86 to 154.70 from 163.87 at 122.71. Rise from there is now expected to develop into a medium term corrective pattern. Upside should be limited by 38.2% retracement of 195.86 to 122.36 at 150.4 for setting the medium term range.
In the longer term picture, while price actions from 122.36 would develop into a medium term correction, fall from 195.86 is still seen as resuming the down trend from 251.09 (2007 high). Hence, after the correction from 122.36 completes we’d expect another fall through 116.83 low.
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