GBP/JPY Daily Outlook
Daily Pivots: (S1) 143.36; (P) 144.00; (R1) 145.11;
With 138.49 minor support intact, further rally is expected in GBP/JPY. Current rise should target long term fibonacci level at 150.43. As such rebound is seen as part of a correction pattern, we'd be cautious on topping at 150.43 on first attempt. On the downside, break of 138.49 support, however, will indicate short term topping and bring pull back.
In the bigger picture, the down trend from 195.86 top (2015 high) should have made a medium term bottom at 122.36 after hitting 100% projection of 195.86 to 154.70 from 163.87 at 122.71. Rise from there is now expected to develop into a medium term corrective pattern. Further rise should be seen to 38.2% retracement of 195.86 to 122.36 at 150.4. We'd expect strong resistance from there to limit upside. But sustained break there will extend the rise to 61.8% retracement at 167.78.
EUR/JPY Daily Outlook
Daily Pivots: (S1) 120.62; (P) 121.26; (R1) 121.64;
EUR/JPY drops sharply today but stays above 118.54 support. Intraday bias remains neutral first. Break of 118.54 will confirm short term topping and bring deeper fall back to 55 days EMA (now at 116.49). Meanwhile, price actions from 109.20 are viewed as a corrective move. Sustained break of 116.49 will indicate that it's completed and bring retest of 109.20 low. On the upside, above 121.88 will target 126.09 key support turned resistance.
In the bigger picture, price actions from 109.20 medium term bottom are seen as corrective whole down trend from 149.76 to 109.20. There is prospect of another rise towards 126.09 key resistance level before completion. But even in that case, we'd expect strong resistance between 126.09 and 141.04 to limit upside. Meanwhile, break of 109.20 will extend the down trend from 149.76 towards 94.11 low.
