After an aggressive Friday with a release of the Job report from the USA and we saw the USD decline aggressively against all major currencies, the GBP/JPY also declined for more than 70 pips after it touched a resistance area.
The currency pair is trading inside the price channel and near the upper limit of this channel so it might decline within the next trading hours especially since it formed a converse bearish candle last Friday and we can predict the downside now. It returned back up today after touching the SMA. The RSI indicator is ahead of 90 level to give us the sell signal and the MACD is still in a buy sign.
The Next Few Days
From this analysis we can sell the pair now at 140.12 after we saw the bearish candle last Friday. For a better entry we can wait till the pair breaks the SMA down and keep our target at 138.70 at the support area. On the other hand, if the pair breaks the price channel up and rises to 140.70 we can buy it after the flag is broken on the daily chart and place the flag target at 147.70 and the MACD on the daily chart will give us the buy signal this week if the pair rises.
We have to be careful about the upcoming hot news like the Claimant Count Change and the Official Bank Rate from the UK and the Bank of Japan Policy Rate.
