Forex technical analysis: GBPJPY continues move higher, but more contained.

Technical Analysis

Author: Greg Michalowski | gbpjpy

Helped by steady GBPUSD and USDJPY strength today

Yesterday, the GBPUSD was the straw that stirred the GBPJPY drink.
Today, the USDJPY is the straw. 
Both days are seeing moves higher.

Technically, looking at the daily chart, the pair surged away from the 50% retracement at 136.519, above the 200 day MA at 137.20, trend line resistance at 138.00. The pair stalled at the natural resistance level of 140.00 (the high reached 140.01), and settled at 139.188. Still that range include 5 big figure prints (136, 137, 138, 139 and 140), and a 386 pip trading range.  Moreover, it did  a good job of turning the bias from more bearish to a little more bullish (Fails below the 50% and the 200 day MAs).

Today, we have seen an extension to a new high of 140.186. We currently trade at 139.8higher stock market opening too (Nasdaq up 24 points and S&P futures are now up 8.25 points).   The USDJPY is the straw that is stirring the GBPJPY drink today.

What next?

Well, looking at the daily, the pair still remains below the 100 day MA above. That comes in at 141.20 currently (blue line the chart above).  That will be the next key target as long as the bulls remain in control. 

Drilling down to the 5- minute chart, the trend mover higher yesterday, has seen a consolidation/corrective move, followed by a slower move to the upside. 

The consolidation/correction did allow for the 100 and 200 bar MAs (blue and green lines) to catch up.  The price did move below the 100 bar MA but could not move below the 200 bar MA.  So there was a chink in the bullish armor, but it did not wound the bullish bias.  Later the 100 bar MA reestablished as support and the price moved higher (the 100 bar MA is at 139.64 currently). Also, a trend line is providing a support level as well. That line comes in at 139.71 now.  That is close risk for longs now. Stay above is more bullish. Move below and the waters get more muddy with traders next eyeing the 200 bar MA at 139.464.  

On the topside, the channel topside line cuts across at 140.24. The most recent high stalled near the area.  

So for trading now today, we maintain a bullish bias but trade in the intraday channel. 

PS we are down testing that 100 bar MA and trend line over the last few minutes. This is a test for the buyers against support. Can they hold the line and restart the upside from here?