Daily Technical Report of Major and Cross Currencies

Daily Pivots: (S1) 131.27; (P) 131.85; (R1) 132.79;

Intraday bias in GBP/JPY remains on the upside with 130.11 minor support intact and recent rally is still expected to continue to 140.02 key resistance level. On the downside, below 130.11 minor support will turn bias neutral and bring consolidations. But break of 126.54 is needed to signal short term topping. Otherwise, outlook will remain bullish for another rally

In the bigger picture, recent development argues that choppy decline from 163.05 is completed at 116.83 already. Focus remains on 140.02 and sustained break there will confirm this bullish case. More importantly, this will also signal completion of the whole down trend from 2007 high of 251.09. In such case, stronger rise should be seen back to retest on 163.05 resistance next. Though, failure below 140.02 resistance will indicate that GBP/JPY is merely in sideway trading pattern between 116.83 and 140.02.
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EUR/JPY Daily Outlook

Daily Pivots: (S1) 109.30; (P) 109.63; (R1) 110.27;

Today's sharp fall suggests that a temporary top is formed at 110.14 in EUR/JPY and intraday bias is turned neutral. EUR/JPY might retreat back to 4 hours 55 EMA (now at 18.51) and below. But downside should be contained well above 105.64 and bring another rally. Above 110.14 will target 111.57 key resistance next. As noted before, fall from 123.31 has likely finished on bullish convergence condition in daily MACD. Break of 111.57 will affirm this bullish case and target 123.31 key resistance next.

In the bigger picture, the case of trend reversal in EUR/JPY is starting to build up and 97.03 should be a medium term bottom. Break of 111.57 will affirm this case and should at least push EUR/JPY for a test on 123.31 resistance. Break there will argue that whole down trend from 2008 high of 169.96 is completed and reversed. Though, failure to take out 123.31 and reversal from there will likely bring some sideway trading between 97.03/123.31 in medium term.
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