FXStreet (Delhi) – Research Team at Societe Generale, expects JPY to strengthen across the board after it achieved multi-decade trend line. Key Quotes “Having undergone a 4Y recovery, GBP/JPY met the descending trend at 196/200 this year. Up moves in the past have been capped around this line on multiple occasions dating back to 1975. The price action since the 1990s has evolved within a flattish channel, the median of which also coincides with 196/200. Long-dated indicators have topped out and retraced after hitting a pivotal ceiling (circled). This horizontal ceiling has given way to elongated downtrends previously (in 1980, 1990, 1998 and 2007). Thus, 196/200 is likely to remain a key hurdle.” “Formation of a multi-month head and shoulders pattern (inset) adds more weight of evidence to the above configuration, as it underlines the slow deterioration of bullish momentum, particularly since late 2014. Confirmation that this pattern, i.e. a break below 175, which is also the monthly moving average, has underpinned the up move in the pair since 2012 will signal a turnaround in the trend. We this think a period of JPY strengthening is likely in 2016; GBP/JPY shows the possibility of a down move towards the 2009 highs of 163.” For more information, read our latest forex news.