GBP/JPY Daily Outlook
Daily Pivots: (S1) 171.79; (P) 172.04; (R1) 172.50;
Intraday bias in GBP/JPY remains mildly on the upside and the rebound from 169.53 could extend higher to 173.46 and above. Overall, the consolidation pattern from 174.84 is still in progress. In case of a further rally, strong resistance would be seen below 174.84 to bring the reversal to extend the consolidation pattern. Meanwhile, below 169.53 will turn bias back to the downside and extend the fall from 173.46.
In the bigger picture, the uptrend from 116.83 (2011 low) might still extend to above 174.84. Nevertheless, upside momentum is rather unconvincing as seen in the weekly MACD. Thus, even in that case, we'd expect strong resistance from the 50% retracement of 251.09 to 116.83 at 183.96 to limit upside. Meanwhile, a sustained break of 163.87 support should confirm medium term topping at 174.84 and bring a deeper correction to the 147.61/156.77 support zone next.
EUR/JPY Daily Outlook
Daily Pivots: (S1) 139.05; (P) 139.51; (R1) 140.36;
Some volatility was seen in EUR/JPY but the outlook is unchanged. A short term bottom was formed on a bullish convergence condition in 4 the hour MACD at 137.97. A stronger rise should be seen to the 55 day EMA (now at 140.18) and above. Overall, the consolidation pattern from 145.68 is still in progress. Even in case of a further rise, strong resistance would likely be seen below 143.78 to bring another decline to extend the consolidations. On the downside, a break of 137.97 will extend the fall from 143.78 towards 136.22.
In the bigger picture, the loss of upside momentum was seen in the bearish divergence condition in weekly MACD. However, EUR/JPY is so far holding above 135.50 key support. Thus, there is no confirmation of a trend reversal yet. A break of 145.68 will extend the up trend from 94.11 towards the 76.4% retracement of 169.96 to 94.11 at 152.59 before topping. Meanwhile, a break of 135.50 will confirm reversal and target 124.95 support.
