GBP/JPY Daily Outlook
Daily Pivots: (S1) 146.82; (P) 147.67; (R1) 148.75;
Intraday bias in GBP/JPY remains neutral as consolidation from 144.97 continues. In case of stronger rise, upside should be limited by 150.92 (50% retracement of 156.59 to 144.97 at 150.78 to bring fall resumption. Break of 144.97 will extend the decline from 156.59 to 143.51 medium term fibonacci level next.
In the bigger picture, the case for medium term reversal continues to build 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.
EUR/JPY Daily Outlook
Daily Pivots: (S1) 130.75; (P) 131.32; (R1) 131.97;
Intraday bias in EUR/JPY remains neutral at this point. Corrective rise from 129.34 might extend higher. But we’d be cautious on strong resistance from 38.2% retracement of 137.49 to 129.34 at 132.45 to limit upside. Break of 129.34 will resume the whole decline from 137.49 to 126.61 medium term fibonacci level. Nonetheless, sustained break of 132.45 will target 61.8% retracement at 134.37 first, before resuming the fall from 137.49.
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. On the upside, break of 137.49 is needed to confirm medium term rise resumption. Otherwise, risk will now stay on the downside even in case of strong rebound.
