GBP/JPY Approaches December High

GBP/JPY approaches the December high (198.96) as stages a three-day rally.

GBP/JPY Outlook

GBP/JPY trades to a fresh monthly high (198.26) as it carves a series of higher highs and lows, with a breach above the December high (198.96) bringing the October high (199.81) on the radar.

Need a break/close above the 199.80 (61.8% Fibonacci extension) to 200.50 (78.6% Fibonacci extension) zone to bring the 202.00 (23.6% Fibonacci extension) to 202.40 (50% Fibonacci extension) area on the radar, but GBP/JPY may track the flattening slope in the 50-Day SMA (195.45) should it struggle to extend the bullish price series.

Failure to test the December high (198.96) may push GBP/JPY back towards the 195.70 (61.8% Fibonacci extension) to 196.60 (23.6% Fibonacci extension) region, with a break/close below the 192.40 (50% Fibonacci extension) to 193.50 (38.2% Fibonacci extension) area opening up 189.00 (38.2% Fibonacci extension).

--- Written by David Song, Strategist at FOREX.com