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After weeks of stubborn consolidation, the British Pound finally looks set to move lower against the Japanese Yen as expected. Prices are testing below support is at 169.28, the 23.6% Fibonacci expansion, with a break of this barrier initially exposing the 38.2% level at 167.68. Alternatively, a push above resistance at a falling trend line set from early January (now at 171.10) targets the February 18 high at 171.87.
Confirmation of a breakdown requires a daily close below support, making a short position premature at this stage. On the other hand, a long position would require taking as given the as-yet baseless assumption that support will hold. We will continue stand aside for now until greater clarity emerges.
Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com