EUR/USD Daily Outlook
Daily Pivots: (S1) 1.1578; (P) 1.1653 (R1) 1.1700;
Intraday bias in EUR/USD remains on the downside. Current fall from 1.2555 is in progress and should target 50% retracement of 1.0339 to 1.2555 at 1.1447 next. On the upside, above 1.1639 minor resistance will turn intraday bias neutral again. But after all, near term outlook will remain bearish as long as 1.1995 resistance holds, in case of recovery.
In the bigger picture, current development suggests that EUR/USD was rejected by 38.2% retracement of 1.6039 (2008 high) to 1.0339 (2017 low) at 1.2516. And, a medium term top was formed at 1.2555 already. Decline from there should extend further to 61.8% retracement of 1.0339 to 1.2555 at 1.1186 and below. For now, even in case of rebound, we won’t consider the fall from 1.2555 as finished as long as 55 day EMA (now at 1.2049) holds.
GBP/USD Daily Outlook
Daily Pivots: (S1) 1.3290; (P) 1.3315; (R1) 1.3337;
Intraday bias in GBP/USD remains on the downside as recent decline from 1.4376 is in progress. Next target will be 50% retracement of 1.1946 to 1.4376 at 1.3161. On the upside, above 1.3377 minor resistance will turn intraday bias neutral and bring consolidation. But break of 1.3568 resistance is needed to indicate short term bottoming. Otherwise, outlook will remain bearish in case of recovery.
In the bigger picture, current development suggests that whole medium term rebound from 1.1936 (2016 low) has completed at 1.4376 already, with trend line broken firmly, on bearish divergence condition in daily MACD, after rejection from 55 month EMA (now at 1.4223). 61.8% retracement of 1.1936 (2016 low) to 1.4376 at 1.2874 is the next target. We’ll pay attention to the reaction from there to asses the chance of long term down trend resumption. For now, outlook will stay bearish as long as 55 day EMA (now at 1.3730) holds, even in case of strong rebound.
