GBP/JPY’s pullback from 208.09 extended lower last week but recovered after hitting 202.08. Initial bias remains neutral this week first. Further fall is in favor as long as 205.77 resistance holds. This decline from 208.09 might be correcting the whole rise from 178.32 already. Break of 202.08 will target 55 D EMA (now at 201.21). Sustained break there will target 38.2% retracement of 178.32 to 208.09 at 196.71. Nevertheless, break of 205.77 will retain near term bullishness and bring retest of 208.09 high.
In the bigger picture, medium term outlook will stay bullish as long as 188.63 resistance turned support holds. Long term up trend remains in favor to continue through 208.09 at a later stage. However, firm break of 188.63 will be a strong sign of bearish trend reversal.
In the longer term picture, rise from 122.75 (2016 low) is seen as the third leg of the pattern from 116.83 (2011 low). Next target is 138.2% projection of 116.83 to 195.86 from 122.75 at 231.96. Outlook will stay bullish as long as 188.63 resistance turned, or until a clear reversal pattern forms.
