USD/JPY Daily Outlook
Daily Pivots: (S1) 106.29; (P) 106.66; (R1) 107.18;
USD/JPY is still bounded in consolidation from 105.24 and intraday bias remains on the upside. Note again that bullish convergence condition is seen in 4 hour MACD. On the upside, decisive break 107.67 resistance will indicate near term reversal. In such case, outlook will be turned bullish for 110.47 resistance next. But before that, another decline is still mildly in favor. 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.
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.
USD/CAD Daily Outlook
Daily Pivots: (S1) 1.2774; (P) 1.2841; (R1) 1.2876;
Intraday bias in USD/CAD remains on the downside for the moment. The pull back from 1.3000 might extend to near term channel support (now at 1.2720). At this point, we’d expect strong support from 38.2% retracement of 1.2246 to 1.3000 at 1.2712 to contain downside and bring rise resumption. On the upside, break of 1.3000 will resume the medium term rally to 1.3065 medium term fibonacci level
In the bigger picture, we’re favoring the medium term bullish case. That is larger down trend from 1.4689 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.
