Daily Currency Outlook: GPB/JPY and EUR/JPY

Daily Pivots: (S1) 128.04; (P) 128.64; (R1) 129.71

As noted before, GBP/JPY's pull back could be finished at 126.54 already and intraday bias is cautiously on the upside for 130.13 resistance. Break will confirm resumption of whole rise from 117.29 and should target 61.8% retracement of 140.02 to 116.83 at 131.16. Break will target a test on 140.02 next. On the downside, though, below will bring another fall towards 55 days EMA (now at 124.11) to extend the consolidation.

In the bigger picture, the choppy decline from 163.05 is viewed as part of the down trend from 251.09. Current development is starting to suggest that such fall is finished. Focus is now turned to 140.02 key resistance. Sustained break there will firstly indicate completion of fall from 163.05. More importantly, this will also signal completion of the whole down trend from 2007 high of 251.09. In such case, stronger rise should be seen back to retest on 163.05.
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EUR/JPY Daily Outlook

Daily Pivots: (S1) 107.09; (P) 107.78; (R1) 108.96;

As noted before, EUR/JPY's pull back from 109.83 has likely completed at 105.64 after drawing support from mentioned 38.2% retracement of 99.24 to 109.83 at 105.78. Intraday bias remains mildly on the upside for 109.83 resistance. Break will confirm resumption of rally from 97.03. We're favoring the case that fall from 123.31 has finished on bullish convergence condition in daily MACD. Above 109.83 will target 111.57 resistance for confirmation. However, break of 105.64 will invalidate this bullish case and will flip bias back to the downside for near term trend line support (now at 103.98).

In the bigger picture, the case of trend reversal in EUR/JPY is starting to build up and 97.03 should be a medium term bottom. Break of 111.57 will affirm this case and should at least push EUR/JPY for a test on 123.31 resistance. Break there will argue that whole down trend from 2008 high of 169.96 is completed and reversed. Though, failure to take out 123.31 and reversal from there will likely bring some sideway trading between 97.03/123.31 in medium term.
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