USD/CAD Daily Outlook
Daily Pivots: (S1) 1.2857; (P) 1.2928; (R1) 1.2983;
USD/CAD is staying in consolidation below 1.3000 temporary top and intraday bias remains neutral. Near term outlook remains bullish as long as 1.2757 resistance turned support holds. Another rise is still in favor. Above 1.3000 will extend the rise from 1.2246 to t 1.3065 fibonacci level next. However, firm break of 1.2757 will indicate reversal and turn outlook bearish for 1.2450 support.
In the bigger picture, strong break of 1.2919 resistance adds much credence to the bullish case. That is larger down trend from 1.4589 has completed at 1.2061, drawing support from 50% retracement of 0.9406 (2011 low) to 1.4689 (2015 high) at 1.2048. Further rally should be seen back to 38.2% retracement of 1.4689 to 1.2061 at 1.3065 first. Break will target 61.8% retracement at 1.3685. This will be the preferred case now as long as 1.2687 support holds.
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USD/JPY Daily Outlook
Daily Pivots: (S1) 105.60; (P) 105.91; (R1) 106.37;
Intraday bias in USD/JPY remains neutral at this point. With 107.67 resistance intact, near term outlook stays bearish and further fall is expected. On the downside, break of 105.24 will resume larger decline from 118.65 and target 100% projection of 118.65 to 108.12 from 114.73 at 104.20 next. Firm break there will pave the way to 98.97 key support level and below. However, break of 107.67 will indicate short term bottoming, on bullish convergence condition in 4 hour MACD. In such case, stronger rebound would be seen back to 55 day EMA (now at 108.93) first.
In the bigger picture, current development argues that the corrective pattern from 118.65 is extending. The solid break of 61.8% retracement of 98.97 to 118.65 at 106.48 now suggests that the pattern from 125.85 high is possibly extending. Deeper fall could be seen through 98.97 key support (2016 low). This bearish case will now be favored as long as 110.47 resistance holds.
