EUR/JPY Daily Outlook
Daily Pivots: (S1) 131.06; (P) 131.33; (R1) 131.59;
Intraday bias in EUR/JPY remains neutral as consolidation from 128.94 is still unfolding. As long as 132.40 holds, near term outlook remains bearish for deeper fall. On the downside, break of 128.94 will extend the whole fall from 137.49 to 126.61 medium term fibonacci level next. Nonetheless, break of 132.40 should confirm short term bottoming and turn bias back to the upside for stronger rebound.
In the bigger picture, current development argues that rise from 109.03 (2016 low) has completed at 137.49, on bearish divergence condition in weekly MACD. Deeper fall should be seen to 38.2% retracement of 109.03 to 137.49 at 126.61 first. Sustained break there would pave the way to 61.8% retracement at 119.90. On the upside, break of 132.40 resistance will indicate that the pull back is completed and bring retest of 137.49. But still, break of 137.49 is needed to confirm medium term rise resumption. Otherwise, outlook is neutral at best for consolidations.
GBP/JPY Daily Outlook
Daily Pivots: (S1) 149.91; (P) 150.57; (R1) 151.25;
GBP/JPY’s rebound from 144.97 is trying to resume today but focus stays on 150.92 resistance. Firm break there will extend the rise to 61.8% retracement of 156.59 to 144.97 at 152.15 and above. The price actions from 144.97 are still corrective looking. Hence, we’ll look for sign of loss of upside momentum as it approaches 156.59 high. However, break of 148.37 minor support should confirm rejection from 150.92 resistance. In that case, deeper fall should be seen through 144.97 to resume the decline from 156.59.
In the bigger picture, the case for medium term reversal has been building up. There is bearish divergence condition in daily MACD. 146.96 support was taken out. And GBP/JPY was rejected by 55 month EMA. Break of 38.2% retracement of 122.36 to 156.59 at 143.51 will pave the way to 61.8% retracement at 135.43 and below. This will now be the preferred case as long as 150.92 resistance holds. However, sustained trading above 150.92 will argue that the larger rise from 122.36 might still be in progress for another high above 156.59.