Daily Currency Outlook: GPB/JPY And EUR/JPY : August 26, 2015
ActionForex | Aug 26, 2015 06:37AM ET
Daily Pivots: (S1) 185.02; (P) 187.50; (R1) 188.94;
Intraday bias in GBP/JPY remains neutral for more sideway consolidations. So far, price actions from 195.86 are viewed as a consolidation pattern and we'll still expect strong support from 61.8% retracement of 174.86 to 195.86 at 182.88 to contain downside. However, sustained break of 182.88 will open up bearishness in the cross and will bring deeper fall to 174.86 key support level.
In the bigger picture, the up trend from 116.83 is still in progress and would target 61.8% retracement of 251.09 to 116.83 at 199.80, which is close to 200 psychological level. Medium term momentum is not too convincing with bearish divergence condition in weekly MACD. We'd be cautious on medium term topping around 200 and bring a deep correction. Meanwhile, break of 174.86 will suggest that the trend has reversed earlier than we expect.
Daily Pivots: (S1) 136.05; (P) 137.32; (R1) 138.17;
Intraday bias in EUR/JPY remains neutral for the moment. Choppy rise from 133.29 is viewed as a corrective move and could be the second leg of the pattern from 141.04. Hence, even in case of another rise, we'd be cautious on strong resistance from 141.04 to limit upside and bring another fall as the third leg. Break of 133.29 will now reverse trend and target 126.09 low.
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.
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