USD/JPY Daily Outlook
Daily Pivots: (S1) 109.50; (P) 109.69; (R1) 110.02;
Breach of 109.82 minor resistance suggests that pull back from 111.39 has completed at 108.10 already. ahead of 50% retracement of 104.62 to 111.39. The development revived that case that rebound from 104.62 is still in progress. Intraday bias is back on the upside for 111.39 first. Break will target a test on 114.73 key resistance level. On the downside, though, below 109.36 minor support will delay the bullish case and turn bias neutral again.
In the bigger picture, at this point , we’re slightly favoring the case that corrective decline from 118.65 (2016 high) has completed with three waves down to 104.62. Above 111.39 will affirm this view and target 114.73 for confirmation. However, it should be noted that USD/JPY is bounded in medium term falling channel from 118.65 (2016 high). Sustained break of 61.8% retracement of 104.62 to 111.39 at 107.20 will likely resume the fall from 118.65 through 104.62 low.
GBP/USD Daily Outlook
Daily Pivots: (S1) 1.3272; (P) 1.3335; (R1) 1.3376;
No change in GBP/USD’s outlook. While corrective rise from 1.3203 might extend, upside limited by 1.3617 resistance to bring reversal. On the downside, break of 1.3253 minor support will likely resume the fall from 1.47376 through 1.3203 for 50% retracement of 1.1946 to 1.4376 at 1.3161 first, and 61.8% retracement at 1.2875 next.
In the bigger picture, current development suggests that whole medium term rebound from 1.1936 (2016 low) has completed at 1.4376 already, with trend line broken firmly, on bearish divergence condition in daily MACD, after rejection from 55 month EMA (now at 1.4223). 61.8% retracement of 1.1936 (2016 low) to 1.4376 at 1.2874 is the next target. We’ll pay attention to the reaction from there to asses the chance of long term down trend resumption. For now, outlook will stay bearish as long as 55 day EMA (now at 1.3648) holds, even in case of strong rebound.
