FX.co ★ GBP/JPY Technical Levels and Trading Recommendations for November 21, 2012

Overview

Proceeding from today's 4H chart, the pair continues its upward move till reaching the Support level 132.20 , But it has bounced from it . Currently the pair is testing around the Resistance level 131.75. Given that the pair continues its bullish move and manages to break the Resistance level 131.75, we will receive a strong indicator for more bullish signals which will enable the Resistance level of 132.20 as the level target. Then we should wait for breaking this Resistance level to continue the upward move and open the way towards the Resistance level of 133.00.

On the other hand, if the pair fails to break the Resistance level of 131.75 and bounces from it, it may reverse the bullish move taking a downward move which will enable the Support level of 130.75. Then we should wait for breaking this Support level in order to get new bearish signals. In case the pair is able to break the Support level and closes 4H below, we will get a bearish strength providing new sell signals which will enable the Support level of 130.00 as a level target. Based on the given H4 chart, the technical indicators provide buy signals, but as long as the Resistance level of 131.75 is unbroken, the downward move is still expected invalidating the bullish outlook. Therefore, we should wait for more confirmations before making the decision.

Resistance and Support Levels

R3 (133.00) R2 (132.20) R1 (131.75) S1 (130.75) S2 (130.00) S3 (129.05)

Trading Recommendations

According to the previous analysis, we recommend buying after breaking the Resistance level of 131.75 and closing 4H above with TP 132.30; SL closing 4 hours below the Resistance level will be appropriate.