GBP/JPY Daily Outlook
Daily Pivots: (S1) 143.69; (P) 145.24; (R1) 146.11;
GBP/JPY drops sharply after hitting 146.77 but it's staying above 144.01 support. Intraday bias remains neutral first. On the downside, break of 144.01 will extend the sideway pattern from 148.20 with another fall back to 135.58/65 support zone. On the upside, above 146.77 will turn bias to the upside. Further break of 147.76/148.42 key resistance zone will resume larger rebound from 122.36.
In the bigger picture, rise from medium term bottom at 122.36 is expected to continue to 38.2% retracement of 196.85 to 122.36 at 150.43. Decisive break there will carry long term bullish implications and pave the way to 61.8% retracement at 167.78. In case the sideway pattern from 148.42 extends, we'd be looking for strong support from 135.58 and 50% retracement of 122.36 to 148.42 at 135.39 to contain downside.
EUR/JPY Daily Outlook
Daily Pivots: (S1) 130.26; (P) 130.79; (R1) 131.13;
Intraday bias in EUR/JPY is turned neutral as the cross lost momentum after hitting 131.39. On the downside, break of 129.83 support will indicate short term topping, on bearish divergence condition in 4 hour MACD. This will be supported by the wave four like triangle consolidation from 130.76 to 129.83. In that case, intraday bias will be turned back to the downside for pull back to 55 day EMA (now at 127.37). On the upside, above 131.39 will extend recent rally to long term fibonacci level at 134.20.
In the bigger picture, the down trend from 149.76 (2014 high) is completed at 109.03 (2016 low). Current rally from 109.03 should be at the same degree as the fall from 149.76 to 109.03. Further rise is expected to 61.8% retracement of 149.76 to 109.03 at 134.20. Sustained break there will pave the way to key long term resistance zone at 141.04/149.76. Medium term outlook will remain bullish as long as 125.80 resistance turned support holds.
