GBP/USD Daily Outlook
Daily Pivots: (S1) 1.2770; (P) 1.2845; (R1) 1.2893;
A temporary low is in place at 1.2777 and intraday bias is turned neutral first. Further decline is expected in GBP/USD as long as 1.2919 minor resistance holds. Below 1.2777 will target 1.2661 low first. Decisive break there will resume larger down trend from 1.4376. Next target is 61.8% projection of 1.4376 to 1.2661 from 1.3297 at 1.2237. On the upside, break of 1.2919 minor resistance will suggest short term bottoming and turn bias to the upside for stronger rebound.
In the bigger picture, whole medium term rebound from 1.1946 (2016 low) should have completed at 1.4376 already, after rejection from 55 month EMA. The structure and momentum of the fall from 1.4376 argues that it’s resuming long term down trend. And this will be the preferred case as long as 38.2% retracement of 1.4376 to 1.2661 at 1.3316 holds. However, firm break of 1.3316 would bring stronger rebound to 61.8% retracement at 1.3721. And, the eventual depth of the fall from 1.4376, and the chance of hitting 1.1946 low, will depend on the strength of the interim corrective rebound from 1.2661.
USD/CHF Daily Outlook
Daily Pivots: (S1) 0.9948; (P) 0.9987; (R1) 1.0011;
Intraday bias in USD/CHF remains neutral for consolidation below 1.0026 temporary top. Overall, near term outlook stays bullish as long as 0.9848 support holds. Above 1.0026 will target 1.0067 resistance first. Decisive break there will confirm resumption of larger rise from 0.9186 and should target 1.0342 key resistance next. However, break of 0.9848 support will indicate near term reversal, on bearish divergence condition in 4 hour MACD, and turn outlook bearish.
In the bigger picture, the pullback from 1.0067 has completed at 0.9541 already. And rise from 0.9186 is likely resuming. Firm break of 1.0067 will pave the way to retest 1.0342 key resistance. We’d be cautious on strong resistance from there to limit upside to bring another medium term fall to extend long term range trading.
