Until 22nd June, the GBP/JPY currency pairing (D1 time-frame) had been influenced by a bearish drive. Following that date, a lower bottom formed at 131.728. Bullish sentiment then prevailed.
Following this, the price continued to move upwards, through the Simple Moving Averages of 15 and 34. The Momentum Oscillator also crossed into the zero baseline, which may have made technical traders aware of a possible new uptrend.
A critical resistance level formed at at 135.899 on 9th July, whereby the bears attempted to pull the market lower. A higher bottom at 133.958 then formed on 14th July. At present, the market is being pulled toward the top of the price chart.
If the GBP/JPY currency pair cross the critical resistance level of 135.899, three price targets could be calculated from that point. By using the Fibonacci tool at the higher top (135.899) and moving it to the support area (133.958), a number of targets could be brought into consideration. The first target could be projected at 137.099 (161 %) and the next is likely at 139.040 (261.8%). A third target could be expected at 142.180 (423.6%) if this upward momentum does continue.
Should the 133.958 support level be achieved, the bullish scenario would no longer be valid and may be required for review.
If the upward momentum remains and the demand exceeds supply, the outlook for the GBP/JPY daily time-frame will stay at a bullish level.
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