GBP/JPY is expected to range-trade. It is undermined by the increased investor risk aversion and Japan’s exports. The GBP/JPY downside is limited by the demand from the Japanese importers and improved euro sentiment after the upbeat data on Germany’s Ifo business confidence.
The daily chart is still positive-biased as the MACD and stochastics are bullish, 5-day moving average is above 15-day moving average and is advancing.
The pair is trading below its pivot point. It is likely to trade in a lower range as far as it remains below the pivot point. Short positions are recommended with the first target at 176. A break of that target will move the pair further downwards to 175.45. The pivot point stands at 177.55. In case the price moves in the opposite direction and bounces back from the support level, it will move above its pivot point. It is likely to move further to the upside. According to that scenario, a long position is recommended with the first target at 178.30 and the second target at 179.30.
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