USD/JPY Daily Outlook
Daily Pivots: (S1) 110.12; (P) 110.49; (R1) 110.70;
USD/JPY lost upside momentum after hitting 110.84 and intraday bias is turned neutral. Overall outlook is unchanged that price actions from 111.39 are developing into a corrective pattern. Below 109.18 will start the third leg to 108.10 and possibly below to complete the pattern. Above 110.84 will bring retest of 111.39 first. Break will resume the whole rebound from 104.62.
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.
USD/CAD Daily Outlook
Daily Pivots: (S1) 1.2941; (P) 1.2996; (R1) 1.3040;
USD/CAD continues to stay in range of 1.2817/3066 and intraday bias remains neutral. Further rise is still expected with 1.2817 support intact. Break of 1.3066 will resume the rally from 1.2526 and target 1.3124 key resistance next. However, break of 1.2817 will indicate near term reversal and turn bias to the downside for 1.2728 support and below.
In the bigger picture, we’re favoring the case that that rebound from 1.2061 has not completed yet. But there is no follow through upside momentum so far. Focus remains 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.
