Fundamental Overview:
EGBP/JPY is expected to trade in a lower range. It is undermined by the weak EUR sentiment, sterling sales on soft GBP/JPY cross amid increased investor risk aversion. But sterling sentiment is soothed by the comments from Bank of England Gov. Carney that the central bank is getting closer to the first rate hike--predicted by many economists in early 2015--although any increases is likely to be gradual and limited. But GBP/JPY losses are tempered by the demand from Japanese importers and positions adjustment before the weekend. GBP/JPY downside is also limited by the sterling demand on buoyant GBP/AUD, GBP/NZD and GBP/CAD crosses; positions adjustment before weekend.
Technical Comment:
Daily chart is tilting negative as stochastics falling is from overbought zone, MACD is staging bearish crossover against its exponential moving average and bearish parabolic stop-and-reverse signal hit on Thursday.
Trading recommendations:
The pair is trading below its pivot point. It is likely to trade in a lower range as far as it remains below its pivot point. Short position is recommended with the first target at 176.75. A break of this target will move the pair further downwards to 175.80. The pivot point stands at 178.50. In case the price moves in the opposite direction and bounces back from the support level, then it will moves above its pivot point. It is likely to move further to the upside. In that scenario, a long position is recommended with the first target at 179.15 and the second target at 179.90.
Resistance levels:
179.15
179.90
180.35
Support levels:
176.75
175.80
175.30
The material has been provided by InstaForex Company - www.instaforex.com
