Daily Currency Outlook: GPB/JPY and EUR/JPY

Daily Pivots: (S1) 128.63; (P) 129.19; (R1) 129.74;

GBP/JPY lost some momentum as recovery faced resistance ahead of 130.13 and intraday is turned neutral for the moment. Some more consolidations could be seen but downside should be contained by 126.54 support and bring another rally. Above 130.13 should extend the rise from 117.29 and 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, below 126.54 will bring another fall towards 55 days EMA (now at 124.30) to extend the correction.

In the bigger picture, recent development argues that choppy decline from 163.05 is completed at 116.83 already. Focus remains on 140.02 and sustained break there will confirm this bullish case. 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 resistance next.
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GBP/JPY" title="GBP/JPY" width="600" height="600">

EUR/JPY Daily Outlook

Daily Pivots: (S1) 107.71; (P) 108.18; (R1) 108.66;

EUR/JPY lost momentum after recovery from 105.64 hit 108.65 and intraday bias is turned neutral for the moment. Consolidation from 109.83 is still in progress and another fall could be seen to 105.64 and below. Though strong support should be seen at near term rising trend line (now at 104.52) and bring another rise. Above 108.65 will target 109.83 first and break will target 111.57 key resistance. Note that break of 111.57 will affirm the case that fall from 123.31 has finished on bullish convergence condition in daily MACD.

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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EUR/JPY" title="EUR/JPY" width="600" height="600">