GPB/JPY And EUR/JPYDaily Outlook: September 27, 2012

Daily Pivots: (S1) 125.28; (P) 125.69; (R1) 126.03

Intraday bias in GBP/JPY is mildly on the downside and pull back from 128.82 could extend lower. But still, such decline is viewed as a correction only and downside should be contained by 124.41 support and bring rebound. Above 126.69 minor resistance will flip bias back to the upside. Break of 128.82 will extend the whole rally from 118.82 to 133.48 resistance next. Though, break of 124.41 will dampen our bullish view and turn focus back to 120.82 support instead.

In the bigger picture, at this point, we'd like to maintain that price actions from 116.83 (2011 low) are corrective in nature so far. Rise from 118.82 could be the third leg of the pattern from 116.83 and might target 133.48 and above. But this is far from being certain. After all, the likely scenario is that we'll see more range trading between 116.83 and 140.02 (50% retracement of 163.05 to 116.83 at 139.94) ahead, before an eventual downside breakout. We'll favor this view as long as 140.02 resistance holds.
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EUR/JPY Daily Outlook

Daily Pivots: (S1) 99.68; (P) 100.07; (R1) 100.44

Intraday bias in EUR/JPY remains mildly on the downside and pull back fro 103.86 could extend lower. But still, fall fro 103.86 is viewed as a correction and should be contained by 99.52 support and bring rebound. Above 101.04 minor resistance will flip bias back to the upside for 103.86 first. Also, note again that rally from 94.11 is expected to continue sooner or later and break of 103.86 will target 61.8% retracement of 111.43 to 94.11 at 104.81 and above. Though, sustained trading below 99.52 will dampen our bullish view and turn focus back to 97.98 support instead.

In the bigger picture, we're favoring the case that whole down trend from 169.96 (3008) has completed at 99.11 already, on bullish convergence condition in weekly MACD. Focus is now on 111.43 key resistance level. Break will confirm this bullish case and bring further medium term rise to 123.31 and above (38.2% retracement of 169.96 to 94.11 at 123.08). And, we'd favor this bullish scenario as long as 99.52 support holds.
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