GPB/JPY And EUR/JPY Daily Outlook: April 16, 2012

Daily Pivots: (S1) 127.63; (P) 128.60; (R1) 129.10

GBP/JPY's fall from 133.48 resumed by taking out 127.87 and reaches as low as 127.35 so far today. Intraday bias remains on the downside for 126.54 support. Break there will indicate completion of whole rebound from 117.29 and target 61.8% retracement of 117.29 to 133.48 at 123.47 and below. On the upside, break of 129.57 resistance is needed to indicate completion of fall from 133.48. Otherwise, we'll be cautiously bearish in GBP/JPY even in case of recovery.

In the bigger picture, overall development in yen crosses dampen the bullish view that GBP/JPY has bottomed out at 116.83. And, with 140.02 resistance intact, choppy decline from 163.05 could extend through 116.83 to resume whole down trend from 251.09 (2007 high). On the upside, break of 133.48 is needed to revive the bullish case that GBP/JPY has bottomed at 116.83. Otherwise, more downside is likely in the cross.
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GBP/JPY" title="GBP/JPY" width="640" height="385">
EUR/JPY Daily Outlook

Daily Pivots: (S1) 105.29; (P) 106.19; (R1) 106.67

EUR/JPY drops to as low as 104.77 so far today as fall from 111.43 resumed. The strong break of 105.64 support now indicates that whole rebound from 97.03 is already finished at 111.43, ahead of 111.57 resistance. Intraday bias remains on the downside for 61.8% retracement of 97.03 to 111.43 at 102.53 next. Break will target 97.03 low. On the upside, break of 107.09 resistance is needed to indicates short term bottoming. Otherwise, we'll now stay bearish even in case of recovery.

In the bigger picture, the rebound form 97.03 was disappointing as it failed to take out 111.57 resistance. Indeed, EUR/JPY also failed to sustain above 55 weeks EMA and is back under this level. While the down trend from 169.96 has been showing loss of downside momentum in bullish convergence condition in weekly MACD, there is not enough evidence to warrant a reversal yet. We'd possibly hit a new low below 97.03 before EUR/JPY bottoms.
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EUR/JPY" title="EUR/JPY" width="640" height="385">