FX.co ★ Technical analysis of GBP/JPY for February 23, 2017

GBP/JPY is expected to trade with a bearish outlook as the key resistance is seen at 141.40. The pair is rebounding, having broken above the 20-period moving average. Nevertheless, the declining 50-period moving average is playing a resistance role. Additionally, 141.40 is playing a key resistance role, which should limit the upside potential. Even though a continuation of technical rebound cannot be ruled out, its extent should be limited.

As long as 141.40 holds on the upside, look for a further drop toward 140.00 and even 139.60 in extension.

The pair is trading below its pivot point. It is likely to trade in a lower range as long as it remains below the pivot point. Short positions are recommended with the first target at 140.00. A break below this target will move the pair further downwards to 139.60. The pivot point stands at 141.40. If the price moves in the opposite direction and bounces back from the support level, it will move above its pivot point. It is likely to move further to the upside. According to that scenario, long positions are recommended with the first target at 142.05 and the second one at 142.40.

Resistance levels: 142.05, 142.40, and 143.00

Support levels: 140.00,139.60, and 139.00