GBP/JPY’s corrective fall from 156.05 resumed to 150.64 last week, but rebounded strongly since then. Initial bias is neutral this week first. In case of another fall, through 150.64 support, downside should be contained by 38.2% retracement of 136.96 to 156.05 at 148.75 to bring rebound. On the upside, firm break of 153.14 minor resistance will argue that the corrective fall has completed, on bullish convergence condition in 4 hour MACD. Stronger rise would then be seen back to 155.13/156.05 resistance zone.
In the bigger picture, rise from 123.94 is seen as the third leg of the pattern from 122.75 (2016 low). Focus remains on 156.59 resistance (2018 high). Sustained break there should confirm long term bullish trend reversal. Next target is 61.8% retracement of 195.86 (2015 high) to 122.75 at 167.93. On the downside, break of 149.03 support is needed to be the first sign of completion of the rise from 123.94. Otherwise, outlook will remain bullish even in case of deep pull back.
In the longer term picture, the strong break of 55 months EMA was an early sign of long term bullish reversal. Firm break of 156.69 resistance should now confirm the start of an up trend for 195.86 (2015 high).