GBP/JPY Daily Outlook
Daily Pivots: (S1) 178.95; (P) 179.45; (R1) 179.95;
A temporary low is in place at 178.95 and intraday bias is turned neutral for some consolidations. But upside of recovery should be limited well below 183.96 and bring fall resumption. Decline from 195.86 is still in progress and should target 174.86 key support level next. Break there will indicate larger trend reversal.
In the bigger picture, the breach of the medium term trend line support is taken as a sign of trend reversal. This is supported by bearish divergence condition in weekly MACD. Also, GBP/JPY was close to key cluster resistance of 61.8% retracement of 251.09 to 116.83 at 199.80, which is close to 200 psychological level. Break of 174.86 will confirm trend reversal and bring deeper fall to 38.2% retracement of 116.83 to 195.86 at 165.67. In case of another rise, we'll be cautious on strong resistance from 199.80/200.00 to bring reversal finally.
EUR/JPY Daily Outlook
Daily Pivots: (S1) 131.69; (P) 131.85; (R1) 132.11;
As noted before, rebound from 129.66 is finished at 134.58 already. Deeper fall should be seen for 129.66 support first. Also, EUR/JPY is staying in a falling channel that started at 141.04 and deeper decline is in favor. Break of 129.66 will target a test on 126.09 low.
In the bigger picture, price actions from 149.76 medium term top is viewed as corrective in nature. Strong rebound after failing to sustain below 38.2% retracement of 94.11 to 149.76 at 128.50 argues that it's developing into a sideway pattern. We'd expect more range trading between 126.09 and 149.76 in medium term. And that should then be followed by an upside breakout at a later stage. Nonetheless, decisive break of 126.09 would extend the correction towards 61.8% retracement at 115.36.
