Daily Currency Outlook: GPB/JPY To The Upside, EUR/JPY Neutral

Daily Pivots: (S1) 151.91; (P) 152.32; (R1) 152.88;

Intraday bias in GBP/JPY remains mildly on the upside and further rally would be seen to 154.04 and possibly above. But after all, the pattern from 147.10 is viewed as the second leg of the correction from 156.77 high. Hence, while break of 154.04 cannot be ruled out, strong resistance should be seen below 156.77 to bring reversal to start the third leg. Below 150.66 minor support will turn bias back to the downside for 147.10/61 support zone first.

In the bigger picture, a medium term top is in place at 156.77 on bearish divergence condition in daily MACD. Deeper pull back could be seen to 38.2% retracement of 118.82 to 156.77 at 142.27. Strong support would likely be seen at 140.37 to bring rebound, at least on first attempt. Overall, we'd still expect whole rise from 116.83 medium term bottom to resume later to 163.05 resistance and above after completing the correction.
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EUR/JPY Daily Outlook

Daily Pivots: (S1) 129.61; (P) 130.02; (R1) 130.46;

Intraday bias in EUR/JPY remains neutral first. Overall outlook is unchanged. That is, consolidation pattern from 133.80 top is still in progress. Above 130.72 will bring another rise. Break of 131.96 should extend through choppy rebound from 124.95 to above 132.73. But we'd expect strong resistance below 133.80 to bring another fall to extend the consolidation. Meanwhile, below 127.96 would bring deeper fall through 124.95.

In the bigger picture, current development argues that the medium term up trend from 94.11 has topped out at 133.80 on bearish divergence condition in daily MACD. Consolidation from there could extend with another fall to target 119.10 cluster support (38.2% retracement of 94.11 to 133.80 at 118.63). Strong support would be seen there, at least on initial attempt. But, break will target 61.8% retracement at 109.27. Nonetheless, considering the five wave structure of the rise from 94.11, we'd expect another medium term rally after completing the correction.
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