GBP/JPY
Daily Pivots: (S1) 170.69; (P) 171.14; (R1) 171.62;
Intraday bias in the GBP/JPY remains mildly on the downside for the moment and deeper fall would be seen to 167.77 support. As noted before, price actions from 174.84 are viewed as a consolidation pattern with rebound from 163.87 as the second leg. Break of 167.77 will revive the case that such second leg has completed and will turn outlook bearish for 163.87 and below, as the third leg. Above 173.14 will extend the second leg but we'd expect strong resistance from 174.84 to bring reversal to extend the consolidation pattern.
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 Pivots: (S1) 141.22; (P) 141.55; (R1) 141.99;
Intraday bias in the EUR/JPY remains mildly on the downside and current fall should continue to 139.95 support. Price actions from 145.68 are viewed as forming a consolidation pattern with rise from 136.22 as the second leg. Break of 139.95 will revive that case that such second leg has completed. In such case, outlook will turn bearish as the third leg should have started for 136.22 support and below. Above 143.78 will extend the second leg but in that case, we'd expect strong resistance below 145.68 to limit upside and bring reversal.
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.
