Daily Currency Outlook: GPB/JPY And EUR/JPY : November 18, 2015
ActionForex | Nov 18, 2015 02:43AM ET
Daily Pivots: (S1) 187.07; (P) 187.53; (R1) 188.20;
No change in GBP/JPY's outlook. Price action from 180.36 is viewed as a consolidation pattern with choppy rise from 180.64 as the third leg. Strong resistance is expected at 188.28 to limit upside to finish the consolidation. Below 184.25 support will turn bias to the downside for retesting 180.36 first. Break of 180.36 will extend the whole fall from 195.86 and should then target a test on 174.86 key support level.
In the bigger picture, the breach of the medium term trend line support is taken as a sign of trend reversal. This is supported by bearish divergence 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.
Daily Pivots: (S1) 131.11; (P) 131.45; (R1) 131.71;
Intraday bias in EUR/JPY remains on the downside for the moment as fall from 141.04 is still in progress. Deeper decline would be seen to lower channel support (now at 129.75) Sustained break there will pave the way to test 126.09 low. On the upside, above 133.18 is needed to indicate short term bottoming. Otherwise, near term outlook will stay cautiously bearish.
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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