FX.co ★ Elliott wave analysis of GBP/JPY for October 9, 2019

Renewed uncertainty regarding Brexit whether it will be a hard or soft exit from the EU, has once again pushed GBP lower. Despite a clear loss of downside momentum, our long-term ideal target at 130.78 has been broken and a low has been seen at 130.40. Even though 130.78 has been broken, we still believe that the potential downside from here is limited to 129.95 before a turn higher.

To ease the downside pressure, we need a break above minor resistance at 131.09, while a break above resistance at 131.70 will indicate that a bottom for red wave ii has been seen and a new impulsive rally towards 139.15 is developing.

R3: 132.25

R2: 131.77

R1: 131.33

Pivot: 131.09

S1: 130.71

S2: 130.40

S3: 129.95

Trading recommendation:

Our stop at 131.00 was hit for a small loss. We will buy GBP at 130.05 or upon a break above 131.09