GBPJPY has been on a winning streak, marking a new 16-year high at 203.57 after ten consecutive days of gains. While this positive momentum is evident in the market, indicators like the RSI and stochastics are signaling that the trend may be overextended.
The RSI is hovering around the 70 level, showing signs of flattening, while the stochastic is moving sideways above 80. These technical oscillators suggest that the current upward movement may be reaching unsustainable levels.
If the bullish trend continues, GBPJPY could potentially target the 261.8% Fibonacci extension level at 204.70, based on the downward wave from 188.65 to 178.80. Further upside targets include psychological levels like 205.00 and 206.00, which could act as resistance points.
On the other hand, a pullback in price could find support initially at the previous peak of 201.64. Below this, the 20-day simple moving average at 200.80 and the 198.90 barrier, which aligns with a long-term uptrend line, may serve as additional support levels.
In conclusion, GBPJPY is continuing its uptrend, but caution is warranted as technical indicators are hinting at a possible retracement in the near future. Traders should monitor key levels for potential entry and exit points to navigate the current market conditions effectively.
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