Daily Currency Outlook: GPB/JPY And EUR/JPY : July 17, 2014
ActionForex | Jul 17, 2014 04:48AM ET
Daily Pivots: (S1) 174.01; (P) 174.22; (R1) 174.44;
The GBP/JPY's recovery quickly lost momentum with 4 hours MACD dragged below signal line by the retreat. Intraday bias is turned neutral again. Break of 175.36 resistance will extend the larger up trend and target 180 psychological level. But we'll pay attention to loss of momentum in that case. Meanwhile, below 172.95 will turn bias back to the downside for 172.36 support instead.
In the bigger picture, the up trend from 116.83 (2011 low) might continue higher. But again, as medium term momentum is unconvincing as seen in weekly MACD. Thus, we'd expect strong resistance from 50% retracement retracement of 251.09 to 116.83 at 183.96 to limit upside and bring reversal. Meanwhile, sustained break of 169.53 support should confirm medium term topping and turn outlook bearish.
Daily Pivots: (S1) 137.32; (P) 137.70; (R1) 137.91;
The EUR/JPY's decline resumed by taking out 137.49 temporary low and reaches as low as 137.21 so far. Intraday bias is back on the downside. The cross is in the third leg of the pattern from 145.68 and should target 136.22 support. On the upside, break of 138.44 resistance is needed to indicate short term bottoming. Otherwise, outlook will stay bearish in case of recovery.
In the bigger picture, loss of upside momentum was seen in bearish divergence condition in weekly MACD. However, the EUR/JPY is so far holding above 135.50 key support. Thus, there is no confirmation of trend reversal yet. Break of 145.68 will extend the up trend from 94.11 towards 76.4% retracement of 169.96 to 94.11 at 152.59 before topping. Meanwhile, break of 135.50 will confirm reversal and target 124.95 support.
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