GBP/JPY Daily Outlook
Daily Pivots: (S1) 173.81; (P) 174.98; (R1) 175.88;
GBP/JPY's decline is still in progress and intraday bias remains on the downside for 100% projection of 195.86 to 180.36 from 188.79 at 173.9. Decisive break there will target next long term fibonacci level at 165.67. On the upside, above 176.15 minor resistance will turn bias neutral and bring consolidations. But near term outlook will stay bearish as long as 180.36 resistance turned support holds.
In the bigger picture, the break of 174.86 support affirmed that case of medium term topping at 195.86 on bearish divergence condition in weekly MACD. Fall from 196.85 is currently viewed as a correction and would first target 38.2% retracement of 116.83 to 195.86 at 165.67. We'd asses the depth of correction based on reactions to 165.67 and the structure of the decline. Break of 180.36 will bring rebound but we'd expect strong resistance bring 195.86 to limit upside and bring another fall to extend the corrective pattern.
EUR/JPY Daily Outlook
Daily Pivots: (S1) 127.16; (P) 128.31; (R1) 129.12;
EUR/JPY's fall continues today and reaches as low as 127.31 o far. Intraday bias remains on the downside for a test on 126.09 key support level. We'd stay cautious on strong support from 126.09 and bring rebound. But break of 129.66 support turned resistance is needed to indicate short term bottoming. Otherwise, outlook will stay bearish. Decisive break of 126.09 will extend the larger decline from 149.76.
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.
