GBPJPY has been trading in a range during the past two weeks and is pivoting around the 20 and 50-period moving averages which are converging around the 148.50 level. This also happens to be the 38.2% Fibonacci retracement of the recent rally from 141.34 to 152.85.
Support is expected at the 50% Fibonacci at 147.11. This level has been tested a few weeks ago and was rejected, resulting in the market consolidating just above it. To the upside, the key 150 level and 23.6% Fibonacci will provide resistance, which if broken would see another push higher to re-test the 152.85 peak before the resumption of the August to September uptrend.
A drop below the 50% Fibonacci at 147.11 would turn the focus to the downside to target 145.74. Another leg lower would open the way towards key levels at 144 and 140.
The lack of direction in trend and momentum indicators highlight the neutral feel in the near term. Aside from the horizontal moving averages, the RSI and MACD on the 4-hour chart are flat. Clearer signals are needed to determine where the market will go from here.
