GBP/JPY Pulls Back Ahead of January High

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GBP/JPY pulls back ahead of the January high (198.26) to halt a five-day rally, with the recent weakness in the exchange rate keeping the Relative Strength Index (RSI) below 70.

Lack of momentum to push above the 195.70 (61.8% Fibonacci extension) to 196.60 (23.6% Fibonacci extension) region may push GBP/JPY towards the weekly low (193.39), with a break/close below the 192.40 (50% Fibonacci extension) to 193.50 (38.2% Fibonacci extension) zone bringing the monthly low (190.33) on the radar.

At the same time, a break/close above the 195.70 (61.8% Fibonacci extension) to 196.60 (23.6% Fibonacci extension) region may lead to a test of the January high (198.26), with the next area of interest coming in around the December high (198.96).

--- Written by David Song, Senior Strategist at FOREX.com

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