NEW YORK (fxtechstrategy.com) -- As continued bearish momentum remains in place for the British pound against the Japanese yen, pushing the cross lower for the past week, a follow-through lower is now under way.
GBP-JPY has been under intense bear pressure since failing at the 139.99 level in April. With a convincing break and hold below its Aug. 10 low of 123.27, the cross looks to target its major support at the 2009 low of 118.80.
That level may present considerable support on an initial test and turn the cross back up possibly for a correction. However, if this fails, we should see further weakness toward the psychological benchmark of 118.00 and beyond. Both its weekly and daily RSI are bearish and pointing lower supporting this view.
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On the other hand, a corrective recovery should initially target the Sept. 16 high of 121.74, with a violation of that level targeting the previous day's 122.26 level. Above that will create scope for a move higher toward the Sept. 9 high of 124.22.
