GPB/JPY And EUR/JPY Daily Outlook: December 6, 2012

Daily Pivots: (S1) 131.99; (P) 132.37; (R1) 133.05

Intraday bias in GBP/JPY remains on the upside for the moment. Current rise from 125.67 is is part of the whole rally from 118.82 and should target 133.48 resistance and above. On the downside, break of 130.45 minor support is needed to signal short term topping. Otherwise, near-term outlook will stay cautiously bullish even in case of retreat.

In the bigger picture, at this point, we'd like to maintain that price actions from 116.83 (2011 low) are corrective in nature so far. Rise from 118.82 could be the third leg of the pattern from 116.83 and might target 133.48 and above. After all, the likely scenario is that we'll see more range trading between 116.83 and 140.02 (50% retracement of 163.05 to 116.83 at 139.94) ahead, before an eventual downside breakout. We'll favor this view as long as 140.02 resistance holds.
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GBP/JPY" title="GBP/JPY" width="470" height="809">
EUR/JPY Daily Outlook

Daily Pivots: (S1) 107.25; (P) 107.61; (R1) 108.08

Intraday bias in EUR/JPY remains on the upside with 106.85 minor support intact. Current rise from 100.32, which is part of the rally from 94.11, should target 100% projection of 94.11 to 104.58 from 100.32 at 110.79 next, which is close to 111.43 key resistance. On the downside, below 106.85 minor support will turn bias neutral and bring retreat. But downside should be contained by 105.27 support and bring rally resumption.

In the bigger picture, we're favoring the case that whole down trend from 169.96 (2008 high) has completed at 94.11 already, on bullish convergence condition in weekly MACD. The sustained break above 55 weeks EMA affirmed this view. Break of 111.43 resistance will confirm this bullish case and bring further medium-term rise to 123.31 (38.2% retracement of 169.96 to 94.11 at 123.08) and above. And, we'd favor this bullish scenario as long as 100.32 support holds.
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EUR/JPY" title="EUR/JPY" width="470" height="809">