USD/JPY Daily Outlook
Daily Pivots: (S1) 113.41; (P) 113.73; (R1) 114.00;
USD/JPY’s break of 113.41 minor support indicates completion of rebound from 114.03. Intraday bias is turned back to the downside for 112.30 first. Break there will target 111.37 and possibly below. On the upside, above 114.03 will target a test on 114.54/73 key resistance zone. Overall, price actions from 114.54 are seen as a consolidation pattern. Hence, even in case of deep decline, downside should be contained by 38.2% retracement of 104.62 to 114.54 at 110.75 to bring rebound.
In the bigger picture, corrective fall from 118.65 (2016 high) should have completed with three waves down to 104.62. Decisive break of 114.73 resistance will likely resume whole rally from 98.97 (2016 low) to 100% projection of 98.97 to 118.65 from 104.62 at 124.30, which is reasonably close to 125.85 (2015 high). This will stay as the preferred case as long as 109.76 support holds. However, decisive break of 109.76 will dampen this bullish view and turns outlook mixed again.
AUD/USD Daily Outlook
Daily Pivots: (S1) 0.7242; (P) 0.7285; (R1) 0.7350;
AUD/USD rebounded strongly and focus is now back on 0.7314 key resistance. Sustained break of 0.7314 resistance will indicate medium term reversal. Further rally should be seen to 38.2% retracement of 0.8135 to 0.7020 at 0.7446 next. Nevertheless, failure to sustain above 0.7314, and break of 0.7199 support will retain bearishness and turn bias back to the downside for retesting 0.7020 low.
In the bigger picture, AUD/USD’s decline from 0.8135 could have completed at 0.7020 already, ahead of 0.6826 key support (2016 low). Decisive break of 0.7314 will confirm and bring strong rebound. But for now, we’d expect strong resistance from 0.7500 support turned resistance to limit upside. Medium term fall from 0.8135 should extend to take on 0.6826 low at a later stage.