AUD/USD Daily Outlook
Daily Pivots: (S1) 0.7654; (P) 0.7680; (R1) 0.7709;
AUD/USD’s consolidation from 0.7642 temporary low is still in progress and intraday bias stays neutral. Stronger recovery might be seen. But after all, near term outlook remains bearish as long as 0.7784 resistance holds. On the downside, break of 0.7642 to will bias to the downside to extend recent fall from 0.8135 to retest 0.7500 key support level. On the upside, however, break of 0.7784 will suggest near term reversal and turn bias to the upside for 0.7915 resistance first.
In the bigger picture, medium term rebound from 0.6826 is seen as a corrective move. It might still extend higher but we’d expect strong resistance from 38.2% retracement of 1.1079 to 0.6826 at 0.8451 to limit upside to bring long term down trend resumption. On the downside, break of 0.7500 support will now be an important signal that such corrective rebound is completed. In that case, AUD/USD would be heading back to 0.6826 low in medium term.
EUR/USD Daily Outlook
Daily Pivots: (S1) 1.2236; (P) 1.2285 (R1) 1.2318;
EUR/USD recovers mildly ahead of 1.2238 support. But intraday bias stays on the downside for the moment. Corrective recovery from 1.2154 should have completed with three waves up to 1.2475. Deeper decline is expected to 1.2154 and below. Break there will pave the way to 38.2% retracement of 1.0339 to 1.2555 at 1.1708. This will now be the preferred case as long as 1.2344 resistance holds.
In the bigger picture, key fibonacci level at 38.2% retracement of 1.6039 (2008 high) to 1.0339 (2017 low) at 1.2516 remains intact despite attempts to break. Hence, rise from 1.0339 medium term bottom is still seen as a corrective move for the moment. Rejection from 1.2516 will maintain long term bearish outlook and keep the case for retesting 1.0039 alive. Firm break of 1.1553 support will add more medium term bearishness. However, sustained break of 1.2516 will carry larger bullish implication and target 61.8% retracement of 1.6039 to 1.0339 at 1.3862 in medium term.
