Thursday's Currency Outlook
ActionForex | Sep 19, 2013 04:56AM ET
Daily Pivots: (S1) 157.52; (P) 157.88; (R1) 158.45; More.....
GBP/JPY's break of 158.54 suggest that recent rise has resumed and intraday bias is back on the upside. Current rally is still in progress for 163.05 key resistance level next. On the downside, break of 156.70 support is needed to signal short term topping. Otherwise, outlook will stay bullish.
In the bigger picture, the rally from 116.83 medium term bottom has just resumed and further rally should be seen back to 163.05 resistance. We'd be cautious on strong resistance from there to bring reversal. Though, break of 147.10 is needed to signal completion of the rise. Otherwise, outlook will stay bullish.
EUR/JPY Daily Outlook
Daily Pivots: (S1) 131.95; (P) 132.32; (R1) 132.77;
No change in EUR/JPY's outlook. With 130.97 minor support intact, another rise cannot be ruled out. But we'd continue to expect strong resistance from 133.80 to limit upside and bring reversal to extend the consolidation from 133.80. Break of 130.97 will be an early signal that choppy rise from 124.95 has completed and will turn bias to the downside for 127.96 support for confirmation. However, sustained break of 133.80 will indicate resumption of larger rally and should target 140 psychological level next.
In the bigger picture, medium term up trend from 94.11 has topped out at 133.80 on bearish divergence condition in daily MACD. Consolidation from there could extend with another fall to 55 weeks EMA (now at 122.13) and below. But we'd expect strong support from 119.10 cluster support (38.2% retracement of 94.11 to 133.80 at 118.63) to contain downside. Considering the five wave structure of the rise from 94.11, we'd expect another medium term rally after completing the correction.
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