GBP/JPY Daily Outlook

Daily Pivots: (S1) 199.68; (P) 200.41; (R1) 201.02; More

GBP/JPY's down trend is still in progress and breaches mentioned 199.78 support today. At this point, further decline is still expected as long as 202.28 minor resistance holds. As discussed before, break of 199.78 is now encouraging deeper fall to test 192.60 medium term bottom. ON the upside, though, above 202.28 will indicate that a short term bottom is possibly in place and bring rebound towards 206.51 resistance before staging another fall.

In the bigger picture, medium term rebound from 192.60 has completed at 215.87 after being limited below 100% projection of 192.60 to 208.99 from 199.78 at 216.17 as well as 55 weeks EMA, on bearish divergence condition in daily MACD. The three wave structure of rise from 192.60 to 215.87 is consistent with the view that it's merely a correction to the the medium term down trend from 241.35. Break of 199.78 support confirms this case and bring retest of 192.60 low. On the upside, above 210.54 structure resistance is needed to indicate fall from 215.87 has completed. Otherwise, another decline is still expected even in case of strong rebound.

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