GBP/JPY
Daily Pivots: (S1) 171.65; (P) 172.07; (R1) 172.67;
The recovery from 171.21 extends higher and break of 172.29 mixes up the near term outlook. Intraday bias is turned neutral first. Our view remains unchanged though. Break of 173.46 will extend the rise from 163.87 but will face strong resistance from 174.84 to bring reversal. The consolidation pattern from 174.84 is expected to have another falling leg before completion. On the downside, below 171.21 will turn bias back to the downside for 169.50. Break will indicates that the third leg has stared and should target 167.77 support and below.
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 correction to 147.61/156.77 support zone next.
EUR/JPY
Daily Pivots: (S1) 140.15; (P) 140.38; (R1) 140.72;
A temporary low is in place at 139.88 and intraday bias is turned neutral first. We're favoring the case that rebound from 136.22 has completed at 143.78 already. And, the consolidation pattern from 145.68 has started the third leg down. Upside of recovery from 139.88 should be limited well below 142.47 resistance and bring another decline. Below 139.88 will target 136.22 support and below.
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.
