Daily Currency Outlook: GPB/JPY, EUR/JPY - February 27, 2013

Daily Pivots: (S1) 137.76; (P) 139.17; (R1) 140.51;

Intraday bias in GBP/JPY remains on the downside as the corrective fall from 147.97 continues. Deeper decline would be seen to 38.2% retracement of 118.82 to 147.97 at 136.83 and below. On the upside, break of 142.76 is needed to indicate completion of the corrective fall. Otherwise, risk will now stays on the downside even in case of recovery.

In the bigger picture, medium term fall from 163.05 has completed at 116.83 already. It's a bit early to conclude reversal of the long term down trend from 251.09 (2007 high). But rise from 116.83 should at least be a move at the same degree as fall from 163.05. Thus, medium term rise is now expected back to 163.05. We'll stay bullish as long as 133.48 resistance turned support holds.
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EUR/JPY Daily Outlook

Daily Pivots: (S1) 118.95; (P) 120.15; (R1) 121.34;

Intraday bias in EUR/JPY remains on the downside as the correction from 127.70 continues. Deeper fall could be seen. Though, such decline is still viewed as a correction and thus, we're expecting strong support from 117.04 (38.2% retracement of 100.32 to 127.70 at 117.24) to contain downside and bring rebound. Above 122.25 minor resistance will turn bias back to the upside for recovery. However, note that break of 117.04 would trigger deeper pull back to 50% retracement at 114.01 and below.

In the bigger picture, whole down trend from 169.96 (2008 high) has completed at 94.11 already, on bullish convergence condition in weekly MACD. 123.31 (38.2% retracement of 169.96 to 94.11 at 123.08) is already met. Sustained trading above this level will target 61.8% retracement at 140.98. And, we'll stay bullish as long as 111.43 resistance turned support holds.
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