Daily Currency Outlook: EUR/GBP And EUR/JPY : August 07,2018
ActionForex | Aug 07, 2018 05:39AM ET
Daily Pivots: (S1) 0.8898; (P) 0.8918; (R1) 0.8946;
EUR/GBP is still bounded in consolidation from 0.8957 and intraday bias stays neutral. Overall as long as 0.8815 support holds, outlook remains bearish and further rise is expected in the cross. On the upside, decisive break of 0.8967 cluster resistance (50% retracement of 0.9305 to 0.8620 at 0.8963) should confirm completion of whole decline from 0.9305. EUR/GBP should then target 61.8% retracement at 0.9043 next.
In the bigger picture, EUR/GBP is staying in long term range pattern from 0.9304 (2016 high). The corrective structure of the fall from 0.9305 to 0.8620 is raising the chance that rise from 0.8312 to 0.9305 is an impulsive move. But we’re not too confident on it yet. In any case, we’d stay cautious on strong resistance from 0.9304/5 to limit upside in case of further rally. Meanwhile, if there is another medium term decline, strong support will likely be seen from 0.8303 to contain downside.
h2 EUR/JPY Daily Outlook/h2
Daily Pivots: (S1) 128.51; (P) 128.69; (R1) 128.89;
A temporary low is in place at 128.49 with 4 hour MACD crossed above signal line. Intraday bias in EUR/JPY is turned neutral first. Upside of recovery should be limited by 129.52 minor resistance to bring another fall. Rebound from 124.61 could have completed with three waves up to 131.97 already. Below 128.49 will target 127.13 support for confirmation. Overall, near term risk will stay on the downside as long as 131.13 resistance holds, even in case of strong rebound.
In the bigger picture, for now, EUR/JPY is still holding above 124.08 key support turned resistance. And the larger rise from 109.03 (2016 low) mildly in favor to resume. Break of 133.47 should send the cross through 137.49 high. However, decisive break of 124.08 will confirm medium term reversal and could then pave the way back to 109.03 low and below.
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