The GBP/JPY pair is developing an impulse wave C of he medium term downtrend from 129.32 (light green in the chart). Within this wave we have three subwaves (magenta in the chart) and an impulse subwave C developing from 126.39 including three subwaves (red in the chart) and an impulse subwave C developing from 125.03.

Presently the downside targets are Fibonacci expansions of 131.75-127.76-129.33, 129.33-124.59-126.39, 126.39-124.08-125.03, 125.03-124.33-124.92, 124.92-123.84-124.39.

Supports:

- 123.79-72 = confluence area of expanded objective point (XOP) and contracted objective point (COP)
- 123.60 = COP
- 123.46 = COP
- 123.31 = objective point (OP)
- 123.09 = super expanded objective point (SXOP)

If the price reverses to the upside, the immediate resistances will be Fibonacci retracements of the wave down from 125.03 - this wave is not developed yet, so no resistances are available so far.

Overbought/Oversold

The bigger wave is now moving downwards, so it is preferable to try short positions when the Detrended Oscillator goes above the zero level (5-10 pips above the current prices) or into the overbought area (20-30 pips above the current prices). Watch for opportunities to go short at or near the indicated resistances.

Read more on how to trade with Fibonacci levels.