GBP/JPY Daily Outlook
Daily Pivots: (S1) 181.45; (P) 182.89; (R1) 183.97
Intraday bias in GBP/JPY is turned neutral for the moment. Price actions from 180.36 is viewed as a consolidation pattern. Break of 180.36 will extend the fall from 195.86 to target a test on 174.86 key support level. In case of another rise strong resistance should be seen around 188.28 to end the consolidation.
In the bigger picture, the break of the medium term trend line support is taken as a sign of trend reversal. This is supported by bearish pergence condition in weekly MACD. Also, GBP/JPY was close to key cluster resistance of 61.8% retracement of 251.09 to 116.83 at 199.80, which is close to 200 psychological level. Break of 174.86 will confirm trend reversal and bring deeper fall to 38.2% retracement of 116.83 to 195.86 at 165.67. In case of another rise, we’ll be cautious on strong resistance from 199.80/200.00 to bring reversal finally.
EUR/JPY Daily Outlook
Daily Pivots: (S1) 135.94; (P) 136.27; (R1) 136.53;
Near term outlook in EUR/JPY remains neutral for the moment. On the upside, above 137.34 will target 138.99 first. Break there will indicate that consolidation from 141.04 has completed and the rise from 126.09 is resuming. Meanwhile, below 132.22 will suggest that rebound from 126.09 has completed and will target a test on this support level.
In the bigger picture, price actions from 149.76 medium term top is viewed as corrective in nature. Strong rebound after failing to sustain below 38.2% retracement of 94.11 to 149.76 at 128.50 argues that it’s developing into a sideway pattern. We’d expect more range trading between 126.09 and 149.76 in medium term. And that should then be followed by an upside breakout at a later stage. Nonetheless, decisive break of 126.09 would extend the correction towards 61.8% retracement at 115.36.