GBP/JPY Bulls Look Well Set

Price swings in the GBP/JPY cross in 2010 continued into 2011. Following a deep shake-out in March the subsequent recovery has been decisive, providing a good bull signal.

• WEEKLY CHART The latest recovery here has now tested /eroded the 138.55 38.2% level of prior downleg from the 2009 high. Beyond here our focus would be on the 143.22 50% level, sometimes an effective one in GBP-and JPY-related markets.
• DAILY CHART The recent break through the 135.48 Feb high provided a bull signal. S/term the surge has faltered at the 138.55/139.36 resistance area (38.2% from Weekly chart & Apr-10 high), with subsequent pullback presumed short-lived. Support from the 132.98 22-Mar high has now been tested –ideally the lower 130.18 28-Mar low will hold at this stage.

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