USD/CHF Daily Outlook
Daily Pivots: (S1) 0.9885; (P) 0.9911; (R1) 0.9926;
No change in USD/CHF’s outlook. Deeper fall could be seen as correction from 1.0056 extends. But we’d expect strong support from trend line (now at 0.9830) to contain downside and bring rebound. On the upside, above 0.9977 will suggest that the pull back is finished and bring retest of 1.0056 high. However, sustained break of the trend line will argue that it’s a larger scale correction and will target 0.9724 fibonacci level.
In the bigger picture, medium term decline from 1.0342 has completed with three waves down to 0.9186. Rise from there is currently viewed as a leg inside the long term range pattern. Hence, while further rally would be seen, we’d be cautious on strong resistance from 1.0342 to limit upside. For now, further rise is expected as long as 38.2% retracement of 0.9186 to 1.0056 at 0.9724 holds.
USD/JPY Daily Outlook
Daily Pivots: (S1) 109.10; (P) 109.42; (R1) 109.71;
No change in USD/JPY’s outlook. The correction from 111.39 could extend. But we’d expect support from 108.82 cluster support (38.2% retracement of 104.62 to 111.39 at 108.80) to bring rebound. On the upside, above 110.32 minor resistance will argue that the pull back is completed. And, in that case, retest of 111.39 high should be seen. However, firm break of 108.82 will dampen our view and bring deeper decline to 61.8% retracement at 107.20 and possibly below.
In the bigger picture, corrective decline from 118.65 (2016 high) has completed with three waves down to 104.62. Rise from 104.62 is possibly resuming the up trend from 98.97 (2016 low). This will be the preferred case as long as108.82 support holds. Decisive break of 114.73 resistance will confirm our view and target 118.65 and above. However, sustained break of 108.82 will dampen the bullish outlook and revive the case of a break of 104.62 low before bottoming.
