Overview:

GBP/JPY is expected to trade in a higher range. It is supported by the improved investor risk tolerance, demand from Japan importers and euro short-covering as traders book partial profits before weekend. But GBP/JPY gains are tempered by the Japan export sales. The daily chart is still negative-biased as MACD and stochastics are bearish, although the latter is in the oversold zone, five and 15-day moving averages are declining.

Trading recommendation:

The pair is trading above its pivot point. It is likely to trade in a higher range as far as it remains above its pivot point. As far as the price is above its pivot point, a long position is recommended with the first target at 170.95 and the second target at 171.45. In an alternative scenario, if the price moves below its pivot points, short positions are recommended with the first target at 169.45. A breach of this target will push the pair further downwards and one may expect the second target at 169.10. The pivot point is at 169.90.

Resistance levels:
170.95
171.45
171.85
Support levels:
169.45
169.10
168.50