GBP/JPY Daily Outlook
Daily Pivots: (S1) 149.70; (P) 150.01; (R1) 150.37;
Intraday bias in GBP/JPY remains neutral first. At this point, we're still favoring the case that recovery from 146.92 has completed at 151.92. Another fall is expected and below 148.65 should send GBP/JPY through 146.92. We'd expect strong support from 61.8% retracement of 139.29 to 152.82 at 144.45 to contain downside and bring rebound. On the upside, above 151.92 will retest 152.82 high instead.
In the bigger picture, medium term rebound from 122.36 is still expected to resume after corrective pull back from 152.82 completes. Firm break of 38.2% retracement of 196.85 to 122.36 at 150.43 will carry long term bullish implications. In that case, GBP/JPY could target 61.8% retracement at 167.78. However, break of 139.29 will indicate rejection from 150.43 key fibonacci level. And the three wave corrective structure of rebound from 122.36 will argue that larger down trend is resuming for a new low below 122.26.
EUR/JPY Daily Outlook
Daily Pivots: (S1) 131.79; (P) 132.10; (R1) 132.37;
EUR/JPY is staying in range trading below 134.48 and intraday bias remains neutral. Overall, decisive break of 134.39/48 resistance zone is needed to confirm up trend resumption. Otherwise, even in case of rebound, near term outlook is neutral at best. On the downside, decisive break of 131.65 will confirm rejection from 134.20 fibonacci level and confirm near term reversal. And, in such case, intraday bias will be turned to the downside for 127.55 key support level.
In the bigger picture, medium term rise from 109.03 (2016 low) is seen as at the same degree as the down trend from 149.76 (2014 high) to 109.03 (2016 low). 61.8% retracement of 149.76 to 109.03 at 134.20 is already met. Sustained break there will pave the way to key long term resistance zone at 141.04/149.76. However, break of 127.55 support will argue that the medium term trend has reversed and will turn outlook bearish for deeper fall back to 114.84/124.08 support zone at least.
