Fundamental overview:
GBP/JPY is expected to trade with risks skewed lower. It is uUndermined by lingering worries over Greece, diminished investor risk appetite and Japan's exports. But the GBP/JPY losses are tempered by the demand from the Japanese importers. It is also undermined by the negative GBP sentiment, diminished investor risk appetite and wider than expected U.K. December global goods trade deficit of GBP10.2 billion (versus forecast GBP9.2 billion).
Technical comment:
The daily chart is still positive-biased as the MACD and stochastics are in bullish mode; five-day moving average is rising above 15-day moving average.
Trading recommendations:
The pair is trading above its pivot point. It is likely to trade in a higher range as far as it remains above its pivot point. As long as the price is keeping above its pivot point, a long position is recommended with the first target at 181.80 and the second target at 182.65. In an alternative scenario, if the price moves below its pivot points, short positions are recommended with the first target at 179.20. A break of this target would push the pair further downwards, and one may expect the second target at 178.50. The pivot point is at 179.95.
Resistance levels:
181.80
182.65
183.35
Support levels:
179.20
178.50
177.70