Daily Currency Outlook: USD/JPY And USD/CHF: June 18,2018

USD/JPY Daily Outlook

Daily Pivots: (S1) 110.40; (P) 110.65; (R1) 110.92;

USD/JPY continues to lose upside momentum as seen in 4 hour MACD. With 109.91 minor support intact, further rise is mildly in favor for 113.39 resistance. Break there will resume larger rebound from 104.62 and target 114.73 resistance. On the downside, though, break of 109.91 will turn bias to the downside and bring another fall towards 108.10 to extend the corrective pattern from 111.39.

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/CHF Daily Outlook

Daily Pivots: (S1) 0.9951; (P) 0.9970; (R1) 0.9995;

Intraday bias in USD/CHF remains on the upside for 1.0056. Firm break there will resume the rally from 0.9186 and target 61.8% projection of 0.9186 to 1.0056 from 0.9787 at 1.0325, which is close to 1.0342 key resistance. On the downside, though, below 0.9894 minor support will turn bias neutral and could extend the correction from 1.0056 for a while.

In the bigger picture, medium term decline from 1.0342 has completed with three waves down to 0.9186. Rise from there is currently viewed as a leg inside the long term range pattern. Hence, while further rally would be seen, we’d be cautious on strong resistance from 1.0342 to limit upside. For now, further rise is expected as long as 38.2% retracement of 0.9186 to 1.0056 at 0.9724 holds. 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.

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