GBP/JPY Daily Outlook
Daily Pivots: (S1) 171.90; (P) 172.20; (R1) 172.66;
Intraday bias in the GBP/JPY is mildly on the upside for 173.57 resistance. Overall outlook is unchanged. Price actions from 174.84 are viewed as a consolidation pattern with rebound from 163.87 as the second leg. Rise from 163.87 could extend beyond 173.57. But we'd expect strong resistance from 174.84 to limit upside and bring another decline as the third leg. Meanwhile, below 167.77 will indicate that the third leg as started and will target 163.87 low.
In the bigger picture, the up trend from 116.83 (2011 low) might still extend to above 174.84. Nonetheless, upside momentum is rather unconvincing as seen in weekly MACD. Thus, even in that case, we'd expect strong resistance from 50% retracement retracement of 251.09 to 116.83 at 183.96 to limit upside. Meanwhile, sustained break of 163.87 support should confirm medium term topping at 174.84 and bring deeper decline to 147.61/156.77 support zone next.
EUR/JPY Daily Outlook
Daily Pivots: (S1) 142.29; (P) 142.67; (R1) 143.35;
Intraday bias in the EUR/JPY remains on the upside for the moment. As noted before, price actions from 145.68 are viewed as a correction pattern with rise from 136.22 as the second leg. Rise from 136.22 could extend through 143.78. But we'd expect strong resistance below 145.68 to limit upside and bring another decline as the third leg. Meanwhile, below 139.95 will turn bias back to the downside for 136.22 low.
In the bigger picture, loss of upside momentum was seen in bearish divergence condition in daily and weekly MACD. However, EUR/JPY is so far holding above 135.50 key support. Thus, there is no confirmation of trend reversal yet. Break of 145.68 will extend the up trend from 94.11 towards 76.4% retracement of 169.96 to 94.11 at 152.59 before topping. Meanwhile, break of 135.50 will confirm reversal and target 124.95 support.
