GBP/JPY - Bottom to be found between 156.02 - 156.21
The decline from the 163.89 high has been relentless, but it's only part of an expanded flat correction and once the low is found a new strong rally higher should be seen.
The low should be found in the 156.02 - 156.21 area. At 156.21 we have the magic 70.7% corrective target of wave [i] (I know that the 70.7% corrective target isn't a Fibonacci number, but it's seen more often holding back corrections to be a mere coincident). the 156.02 target is the limit for wave five of the small ending diagonal that has developed over the last couple of days. As the name "ending diagonal" says it marks the termination of the move and once finished a sharp reversal is expected.
The first indication of a bottom being in place is a break above minor resistance at 157.24, while a break above 158.01 confirms the low for a strong rally higher in wave [iii]. This rally will eventually take us back above the 163.89 top and longer term much more upside is expected.
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