GBP/JPY Daily Outlook
Daily Pivots: (S1) 184.80; (P) 185.30; (R1) 186.10; .
At this point, we're favoring the case that consolidation pattern from 180.36 has completed at 188.79. Deeper fall is expected for a test on 180.36/64 support zone. For the moment, outlook will stay bearish as long as 188.79 resistance holds even in case of recovery.
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) 129.81; (P) 130.29; (R1) 130.80;
EUR/JPY is losing some downside momentum but there is no clear sign of bottoming yet. Sustained break of lower channel support (now at 129.58) will pave the way for a test on 126.09 low. On the upside, break of 133.18 resistance will indicate near term reversal and turn focus back to 136.38 resistance.
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.
