Daily Currency Outlook: GPB/JPY and EUR/JPY

Daily Pivots: (S1) 118.27; (P) 119.00; (R1) 119.46;

GBP/JPY drops further to as low as 118.25 as the week starts and intraday bias remains on the downside. Current decline is expected to continue to 61.8% projection of 127.30 to 119.37 from 122.76 at 117.85, and then 116.83 key support. On the upside, break of 120.19 resistance is needed to indicate short term bottoming. Otherwise, outlook will remain bearish even in case of recovery.

In the bigger picture, fall from 127.30 is tentatively treated as resuming of decline from 140.20, which is part of the medium term down trend from 163.05. Break of 116.83 will confirm such down trend resumption and should target 61.8% projection of 140.02 to 116.83 from 127.30 at 112.96. On the upside, break of 127.30 resistance is needed to be the first sign of medium term reversal. Otherwise, outlook will remain bearish.

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EUR/JPY Daily Outlook

Daily Pivots: (S1) 98.27; (P) 98.81; (R1) 99.15;

EUR/JPY drops further to as low as 97.27 so far today and met mentioned target of 61.8% projection of 123.31 to 100.74 from 111.57 at 97.62. Intraday bias remains on the downside for the moment. Sustained trading below 97.62 will pave the way to 100% projection at 89.00 next. On the upside, above 98.48 minor resistance will turn bias neutral and bring consolidation. But recovery is expected to be limited below 101.04 support turned resistance and bring decline resumption.

In the bigger picture, EUR/JPY's downside momentum is accelerating with a break of lower trend line in weekly chart and with weekly MACD staying below signal line Current fall from 123.31 is part of the down trend from 2008 high of 169.96 and should target 100% projection of 139.21 to 105.42 from 123.31 at 89.52. At this point, we'd anticipate strong support there to bring at least a rebound attempt, as it's close to 88.96 all time low as well as the above mentioned 100% near term projection target at 89.00. Though, a break of 111.57 resistance is needed to be the first signal of reversal. Otherwise, we'll continue to stay bearish in the cross even in case of rebound.

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