USD/CAD Daily Outlook
Daily Pivots: (S1) 1.2762; (P) 1.2793; (R1) 1.2843;
USD/CAD recovered after dipping to 1.2728 and intraday bias is turned neutral first. At this point, we continue to favor the bullish case that rebound from 1.2061 hasn’t completed. Therefore, in case of another fall, downside should be contained well above 1.2526 support and bring rebound. On the upside, above 1.2859 will bring retest of 1.2996 first. However, firm break of 1.2526 will resume the fall from 1.3124 to 1.2246 support and likely below.
In the bigger picture, current development suggests that rebound from 1.2061 has not completed yet. Focus is back on 38.2% retracement of 1.4689 to 1.2061 at 1.3065. Sustained trading above there will confirm medium term bullish reversal. That is, down trend from 1.4689 has completed at 1.2061 already. In that case, next target will be 61.8% retracement at 1.3685. However, break of 1.2526 support will dampen this bullish view again. And, focus will be back on 1.2061 key support level, which is close to 50% retracement of 0.9406 (2011 low) to 1.4689 (2015 high) at 1.2048
EUR/CHF Daily Outlook
Daily Pivots: (S1) 1.1913; (P) 1.1949; (R1) 1.1968;
EUR/CHF is still struggling in range below 1.2004 and intraday bias remains neutral. Consolidation could extend with risk of deeper pull back. But in that case, we’d expect strong support from 38.2% retracement of 1.1445 to 1.2004 at 1.1790 to contain downside and bring rebound. On the upside, decisive break of 1.2004 will confirm up trend resumption.
In the bigger picture, long term up trend in EUR/CHF is still in progress. Prior SNB imposed floor at 1.2000 was already met but there is no sign of reversal yet. As long as 1.1445 support holds, we’d expect the up trend to extend to 2013 high at 1.2649 next. However, considering bearish divergence condition in daily MACD. Break of 1.1445 will be an indication of medium term reversal and will turn outlook bearish.
