USD/CHF Daily Outlook
Daily Pivots: (S1) 0.9875; (P) 0.9910; (R1) 0.9935;
USD/CHF dips to as low as 0.9869 so today and focus is on 0.9855 support. Break there will extend the corrective pattern from 1.0056 with another fall to 0.9787 and below. Nonetheless, we’d expect strong support from 0.9722/4 cluster support (38.2% retracement of 0.9186 to 1.0056 at 0.9724, 100% projection of 1.0056 to 0.9787 from 0.9991 at 0.9722) to bring rebound. On the upside, firm break of 0.9991 will target a test on 1.0056 high.
In the bigger picture, rise from 0.9186 is seen as a leg inside the long term range pattern. For now, further rise is expected as long as 38.2% retracement of 0.9186 to 1.0056 at 0.9724 holds. Above 1.0056 will target 1.0342 (2016 high). In that case, we’d be cautious on strong resistance from 1.0342 to limit upside. However, sustained break of 0.9724 will dampen this bullish view and would at least bring deeper fall to 61.8% retracement at 0.9518.
GBP/USD Daily Outlook
Daily Pivots: (S1) 1.3228; (P) 1.3260; (R1) 1.3316;
GBP/USD’s rebound from 1.3048 short term bottom is still in progress and intraday bias stays on the upside. Break of 1.3314 should now extend the rebound extend the rebound towards 1.3471 resistance next. We’ll expect strong resistance from 1.3471 to limit upside. On the downside, though, below 1.3200 minor support will turn bias to the downside for retesting 1.3048 low.
In the bigger picture, whole medium term rebound from 1.1936 (2016 low) should have completed at 1.4376 already, after rejection from 55 month EMA (now at 1.4179). Fall from 1.4376 should extend to 61.8% retracement of 1.1936 (2016 low) to 1.4376 at 1.2874 next. We’ll pay attention to the reaction from there to asses the chance of long term down trend resumption. On the upside, sustained break of 38.2% retracement of 1.4376 to 1.3048 at 1.3555 is needed to indicate medium term bottoming. Otherwise, outlook will remain bearish in case of strong rebound.
