GBP/JPY Weekly Technical Report 24-28/12/2012

Last Friday, the pair traded negatively achieving most of the targets we have expected, then rebounded off the descending minor-channel support shown on the graph. Stochastic is in overbought areas, helping us to continue favoring downside movement; it ultimately relies on stability below the descending channel support at 137.25, most importantly 137.80. Breaking the 135.65 level will support the move toward bearish targets.

The trading range expected for this week is between the key support at 134.00 and the key resistance at  137.80.

The short-term trend is to the downside targeting 112.00 as far as 150.00 remains intact.

Support 136.35 135.85 135.40 135.00 134.60

Resistance 136.85 137.10 137.50 137.85 138.20

Recommendation based on the graph and explanation above, our opinion is selling the pair below 136.85 targeting 136.35, 135.85 and 135.40 and stop-loss with four-hour closing above 137.50.