Forex: GBP/JPY hits 78.6% Fibo resistance at 6-month highs

FXstreet.com (San Francisco) - GBP/JPY is climbing to new 6-month highs as the JPY weakens across the board following poor October trade data from Japan, and on persistent expectations of more easing from the BoJ.

After breaking above key resistance at 129.60 and gaining ground for a fifth straight day, spot has climbed as high as 130.32 (not seen since May 3) in early Asia and appears now to be negotiating resistance at a 78.6% Fibonacci retracement (133.46/118.75 decline), threatening to target higher levels.

If we continue to see an extension of the recent yen weakening, GBP/JPY bullish targets lie at 130.80 (Aug 4, 2011 peak), then 131.40 (May 24 low) and 131.80 (April 20 high). To the downside, beyond the mentioned 129.60 level (now offered as support), dips may encounter bids at 128.80 (Sep 19 high) and 128.20 (Oct 18 high).

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