USD/CAD Daily Outlook
Daily Pivots: (S1) 1.2559; (P) 1.2590; (R1) 1.2620;
With 1.2622 minor resistance intact, intraday bias in USD/CAD remains on the downside. Sustained trading below 61.8% retracement of 1.2246 to 1.3124 at 1.2581 will bring deeper fall to 1.2061/2246 support zone. On the upside, above 1.2622 will bring recovery. But upside should be limited below 1.2814 support turned resistance and bring another fall.
In the bigger picture, current development turns favors to the case that rise from 1.2061 is a corrective three wave pattern. It could have completed at 1.3124 after hitting 38.2% retracement of 1.4689 to 1.2061 at 1.3065. Focus is now back on 1.2061 and 50% retracement of 0.9406 (2011 low) to 1.4689 (2015 high) at 1.2048. Decisive break there will resume larger down trend from 1.4689 (2016 high) to 61.8% retracement of 0.9406 to 1.4689 at 1.1424.
AUD/USD Daily Outlook
Daily Pivots: (S1) 0.7738; (P) 0.7754; (R1) 0.7771;
AUD/USD rises to as high as 0.7796 so far today. The break of 0.7784 minor resistance is taken as the first sign of near term reversal. Intraday bias is back on the upside for 0.7915 resistance first. Break there will confirm that whole decline from 0.8135 has completed. On the downside, below 0.7737 minor support will turn bias back to the downside for 0.7642 instead.
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.
