GBP/JPY Rally Pushes RSI Back into Overbought Zone
GBP/JPY extends the series of higher highs and lows from earlier this week to register a fresh yearly high (206.17), with the recent advance in the exchange rate pushing the Relative Strength Index (RSI) into overbought territory.
GBP/JPY Outlook
The move above 70 in the RSI is likely to be accompanied by a further advance in GBP/JPY like the price action from earlier this year, and the oscillator may show the bullish momentum gathering pace as it climbs to its highest level this year.
A break/close above 206.60 (100% Fibonacci extension) opens up 208.60 (78.5% Fibonacci extension), with the next area of interest coming in around 213.30 (100% Fibonacci extension) to 214.11 (August 2008 high).
However, lack of momentum to extend the recent series of higher highs and lows may pull the RSI back from overbought territory, with a move below 204.90 (61.8% Fibonacci extension) bringing the 202.00 (23.6% Fibonacci extension) to 202.40 (50% Fibonacci extension) region on the radar.
--- Written by David Song, Strategist at FOREX.com
GBP/JPY Outlook
The move above 70 in the RSI is likely to be accompanied by a further advance in GBP/JPY like the price action from earlier this year, and the oscillator may show the bullish momentum gathering pace as it climbs to its highest level this year.
A break/close above 206.60 (100% Fibonacci extension) opens up 208.60 (78.5% Fibonacci extension), with the next area of interest coming in around 213.30 (100% Fibonacci extension) to 214.11 (August 2008 high).
However, lack of momentum to extend the recent series of higher highs and lows may pull the RSI back from overbought territory, with a move below 204.90 (61.8% Fibonacci extension) bringing the 202.00 (23.6% Fibonacci extension) to 202.40 (50% Fibonacci extension) region on the radar.
--- Written by David Song, Strategist at FOREX.com
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