GBP/JPY Bulls Trying to Gain Control

The FX Specialist view - Price action in the GBP/JPY cross was relatively subdued in the second half of 2010, although staying on the weak side. A recent bounce has again raised the prospect of a better recovery phase, but key resistance still needs to be overcome.

• WEEKLY CHART Price swings have continued here, with the market still unable to hold below the 76.4% level. On the upside a recovery through the current 23.6% rebound level at 134.30 would be a positive sign.
• DAILY CHART: Recent strength has been putting pressure on the bear channel top at 132.25/30. A close above this would be positive, but a further recovery through the 134.21/30 area (Nov high and 23.6% level, see Weekly chart above) is needed for a decent bull signal. We would then start calculating higher targets. First support could lie around the 129.31 30-Nov low.

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