GBPJPY Daily Outlook

Daily Pivots: (S1) 140.50; (P) 143.77; (R1) 145.59;

GBPJPY dives further to as low as 141.48 and recovers mildly after drawing support from the near term rising channel. But after all, further decline is still in favor as long as 145.23 resistance holds. Sustained break of the channel support (now at 141.61) will be an important alert that GBP/JPY has topped out earlier than we thought. Focus should then turn to 135.71 support to confirm that whole rise from 118.81 has completed.

On the upside, above 145.23 will argue that fall from 151.49 has completed with three waves corrective structure and flip intraday bias back to the upside. Further break of 149.82 will confirm that GBP/JPY is resuming recent rally for 151.49 high and above.

In the bigger picture, note that rise from 118.81 is treated as correction to the larger medium term decline from 215.87. The upside target of 38.2% retracement of 215.87 to 118.81 at 155.88 is not met yet but the rise look shaky now with daily MACD breaking its up trend line. Focus remains on the above mentioned support and sustained break there will be the first important alert that such corrective rise from 118.81 has completed. Further break of 135.71 will confirm that rise from 118.81 has topped out earlier than we thought. In such case, short term outlook will be turned bearish for retesting 118.81 low. However, before that, strong rebound from the current level will and break of 149.82 will revive that case that such correction is still underway for 155.88 before completion.