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Forex: GBP/JPY notches highest close since August 2009

FXstreet.com (Barcelona) - The GBP/JPY closed the session sharply higher, up 208 pips at 154.19. This was the highest close for the pair since August 2009, and the recent technical break out could lead to additional buying in coming sessions. Economic data will be light in the coming session with Japan closed for holiday.

According to Chris Capre of 2nd Skies Forex, “Similar to the EURJPY, the GBPJPY has shown even greater support amongst buyers by taking out the yearly high at 153.89 to end last week. This pair has levitated above the 20ema, communicating how the buyers were continually stepping in on dips and expecting higher prices. Upside targets are now 155.84 and then not much is around till 160 and 162.60, so a lot of air up there, thus we remain buyers on dips into 153.80 down to 151.30.”

The FXStreet.com Trend Index remains Slightly Bullish on the daily chart, while the OB/OS Index remains OB. Short term moving averages are also in bullish set up, with price above both the 9 and 20dma’s. From a pattern perspective, the pair appears to have broken out of a “pennant” continuation pattern which has been forming since early April. The pattern has a measured move target of apx 160.75. If the pair reverses and closes below the break out point (153.35) the pattern would be negated and could be considered a “bull trap.”

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