GBPJPY - Monthly long-term Overview

The British Pound versus Yen is presenting a pronounced bearish flag on monthly charts, a double-bottom on weekly in a tight descending channel and a bullish flag on daily time frame, where is is trading inside a symmetrical triangle. Price has been ranging on daily time frame for the last two days but the pair still looks very bearish and has been following a steady descent inside the weekly channel. The pair might push up to the 50% Fibonacci retracement which coincides with the upper trend line of the descending daily channel at about 131.40 where there is a relatively strong resistance area.

My views at a longer term are that the symmetrical triangle on daily will most probably be broken to the downside, and will attempt to make new lows, projection from the weekly bearish flag gives me a probable target in the 121.50 to 120.00 area which coincides with January 2009 lows and a 127.2 to 138.2 Fibonacci extension from the flagpole achieved between April 25 and May 20, 2010.

(Daily chart assessment taken one hour before US markets open on Monday October 11, 2010)

GBPJPY	RES2	RES1	SUP 1	SUP 2	R/R	FORECAST	PRICE ACTION
Monthly	251.25	145.04	120.16	118.88	1:1.2	Consolidation	Bearish Flag
Weekly	179.27	138.26	128.13	118.88	1:2.5	Bullish-Range	Bullish Flag - small Pinbar
Daily	141.77	133.46	130.55	127.67	1:3	Bullish	Bullish Flag - small Pinbar