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The AUD/USD has been in a steady uptrend identified by confluence points (POC) rejections and an upward zig zag trend pattern. POC (trend line EMA 89, 60.0. D L4, ATR pivot, historical buyers) 0.7888-0.7900 is the zone where the AUD/USD could reject again towards W H4 0.7960 and D H4 -0.7980. The range on the AUD/USD is lower so when you take profits aim for 20-30 % of its ATR(14), also due to summer volatility. Break below 0.7860 will target lower levels as shown on the picture, but at this point the main trend is up.

Daily Pivots: (S1) 1.1521; (P) 1.1589 (R1) 1.1699; More...

Intraday bias in EUR/USD remains on the upside for the moment. Sustained trading above 1.1615 key resistance will extend the medium term rise to 1.2 handle next. On the downside, break of 1.1478 support is needed to indicate short term topping. Otherwise, outlook will remain bullish in case of retreat.

In the bigger picture, the firm break of 1.1298 resistance further affirm medium term reversal. That is, an important bottom was formed at 1.0339 on bullish convergence condition in weekly MACD. Further rise would be seen to 55 month EMA (now at 1.1756). Sustained break there will pave the way to 38.2% retracement of 1.6039 (2008 high) to 1.0339 (2017 low) at 1.2516 next. This will now remain the favored case as long as 1.1118 support holds.

USD/CHF - 0.9483

Original strategy :

Sell at 0.9555, target: 0.9455, Stop: 0.9590

Position : -

Target :  -

Stop : -

New strategy  :

Sell at 0.9555, target: 0.9455, Stop: 0.9590

Position : -

Target :  -

Stop : -

The greenback ran into renewed selling interest at 0.9622 yesterday and has dropped sharply since, confirming recent decline has resumed and bearishness remains for further weakness to 0.9460, however, near term oversold condition should prevent sharp fall below previous support at 0.9440-44 and price should stay above 0.9400-10, risk from there is seen for a rebound later.

In view of this, we are looking to sell dollar on recovery as 0.9550-55 should limit upside and bring another decline. Above 0.9580-85 would suggest an intra-day low is formed, bring a stronger rebound towards resistance at 0.9622 which is likely to hold from here.

Daily Pivots: (S1) 1.2926; (P) 1.2979; (R1) 1.3026; More...

GBP/USD is still staying in range of 1.2811/3125 and intraday bias remains neutral. Another rise is mildly in favor with 1.2811 intact. Break of 1.3125 will target 61.8% projection of 1.2108 to 1.3047 from 1.2588 at 1.3168. Overall, choppy rebound from 1.1946 is seen as a corrective pattern, hence, we'd be cautious on strong resistance from 1.3168 to limit upside. But firm break of 1.3168 will bring further rise towards 1.3444 key resistance. Meanwhile, break of 1.2811 support will be the first sign of reversal and will turn bias to the downside to target 1.2588 key support next.

In the bigger picture, overall, price actions from 1.1946 medium term low are seen as a corrective pattern that is still in progress. While further upside is expected, overall outlook remains bearish as long as 1.3444 key resistance holds. Larger down trend from 1.7190 is expected to resume later after the correction completes. And break of 1.2588 will indicate that such down trend is resuming.

GBP/USD - 1.2980

Original strategy :

Sell at 1.3030, Target: 1.2930, Stop: 1.3065

Position : - 

Target :  -

Stop : -

New strategy  :

Sell at 1.3030, Target: 1.2930, Stop: 1.3065

Position : -

Target :  -

Stop : -

Cable recovered after falling to 1.2933 yesterday and minor consolidation would be seen, however, as the drop from 1.3126 signals a temporary top has possibly been formed there, reckon upside would be limited to 1.3025-30 and bring another decline later, below 1.2932-33 (61.8% Fibonacci retracement of 1.2812-1.3126 and said support would bring test of previous support at 1.2912 but break of latter level is needed to retain bearishness and extend the fall from 1.3126 top to 1.2880-85 first. 

In view of this, we are looking to sell cable on recovery as 1.3025-30 should limit upside. Only break of resistance at 1.3062 would abort and signal an intra-day low is formed instead, bring a stronger rebound towards 1.3090-00 but resistance at 1.3126 should remain intact. 

Daily Pivots: (S1) 0.9464; (P) 0.9541; (R1) 0.9590; More...

Intraday bias in USD/CHF remains on the downside at this point. Current fall from 1.0342 should target target 0.9443 key support level next. At this point, we'd expect strong support from there to bring rebound. On the upside, break of 0.9699 resistance is needed to confirm short term bottoming. Otherwise, outlook will remain bearish in case of recovery.

In the bigger picture, USD/CHF is still bounded in medium term range of 0.9443/1.0342 for the moment. Consolidative trading would likely continue and medium term outlook remains neutral. Break of 1.0342 key resistance is needed to confirm underlying bullish momentum in the pair. Meanwhile, downside attempts should be contained by 0.9443 key support level. However, sustained break of 0.9443 will carry larger bearish implication and target 0.9 handle.

EUR/USD - 1.1643

Original strategy  :

Buy at 1.1580, Target: 1.1680, Stop: 1.1545

Position : -

Target :  -

Stop : -

New strategy  :

Buy at 1.1580, Target: 1.1680, Stop: 1.1545

Position : -

Target :  -

Stop : -

Yesterday’s rally after finding renewed buying interest at 1.1479 signals recent upmove has resumed and bullishness remains for this move to extend further gain to indicated upside target at 1.1680, then towards previous chart resistance at 1.1714, however, break there is needed to retain bullishness for the rise from 1.0340 low to head towards 1.1750. 

In view of this, we are looking to buy euro on pullback as previous resistance at 1.1583 should limit downside. Below the upper Kumo (now at 1.1544) would abort and suggest an intra-day top is formed, bring correction to 1.1510-15 but said support at 1.1479 should remain intact.

Canadian Dollar stays firm against dollar in early US session even though it's mixed against other currencies. USD/CAD, trading at 1.2550, has been losing some downside momentum this week, but is still on course to test 2016 low at 1.2460. Headline Canadian CPI dropped -0.1% mom in June. The annual rate slowed to 1.0% yoy, down from 1.3% yoy and missed expectation of 1.1% yoy. That's also the lowest level since October 2015. Nonetheless, two of the three core inflation measures of BoC picked up in the same month. CPI core common rose to 1.4% yoy, up from 1.3% yoy. CPI core median rose to 1.6% yoy, up from 1.5% yoy CPI core trim was unchanged at 1.2% yoy. Meanwhile, Canadian retail sales rose solidly by 0.6% mom in May, beating expectation of 0.4% mom. Ex-auto sales dropped -0.1% mom, missing expectation of 0.4% mom.

Meanwhile, Dollar is set to end the week as the second weakest currency, just after Sterling. Politics and its impact on Fed's tightening path is seen as the main factor driving the greenback down. Investors are also like having no clue on when US President Donald Trump would start the work on pushing his economic policies and tax reforms through the Congress. At the same time Trump is persistently being distracted by other issues. Special counsel Robert Mueller's Russia investigation is currently under the spot light. It's reported that Mueller has expanded his investigations regarding the possible ties between Trump's election campaign and Russia. The investigations will now cover transactions involving Trump's businesses as well as his associates'. And it's now reported the Trump's legal team is seeking ways to control and block Mueller's investigations.

Earlier today, Australian Dollar dipped notably on comments from RBA Deputy Governor Guy Debelle. Debelle urged the markets not to read too much into the board's discussion on neutral rate. He said that "no significance should be read into the fact the neutral rate was discussed at this particular meeting" And, "most meetings, the board allocates some time to discussing a policy-relevant issue in more detail, and on this occasion it was the neutral rate." He also emphasized that "other central banks increase their policy rates does not automatically mean that the policy rate here needs to increase."

EUR/AUD Daily Outlook

Daily Pivots: (S1) 1.4474; (P) 1.4561; (R1) 1.4701; More...

EUR/AUD's strong rebound indicates short term bottoming at 1.4421, after hitting 100% projection of 1.5226 to 1.4625 from 1.4472. The development also suggests completion of the correction from 1.5226, with three waves down to 1.4421. Intraday bias is back on the downside. Sustained trading above 55 day EMA (now at 1.4744) will target 1.5073 resistance. Break there will indicate resumption of whole rise from 1.3624. On the downside, below 1.4585 minor support will turn focus back to 1.4421 instead.

In the bigger picture, we're holding on to the view that corrective decline from 1.6587 medium term has completed at 1.3624. Rise from 1.3624 is expected to resume to retest 1.6587. The corrective structure of the fall from 1.5226 is affirming this view. Above 1.5226 will target a test on 1.6587 key resistance. However, further downside acceleration will dampen our view and would drag EUR/AUD lower to retest key support zone around 1.3624.

Economic Indicators Update

USD/JPY - 111.38

New strategy  :

Stand aside

Position :  -

Target :  -

Stop : -

Although the greenback has fallen again after brief bounce above 112.00 level and downside risk remains for recent decline from 114.50 top to extend weakness to 111.20-25, however, reckon 110.90-00 would hold from here due to near term oversold condition, bring rebound later. 

In view of this, would not chase this fall here and would be prudent to stand aside in the meantime. Above the Kijun-Sen (now at 111.81) would suggest an intra-day low is possibly formed but break of resistance at 112.08 is needed to signal low is formed, bring a stronger rebound to indicated resistance at 112.42 next.

Daily Pivots: (S1) 111.44; (P) 111.93; (R1) 112.38; More...

Intraday bias in USD/JPY remains on the downside as the decline from 114.49 is still in progress. As noted before, sustained trading below 55 day EMA will bring deeper decline to 108.81 support. Break there will extend the whole correction from 118.65 to 61.8% retracement of 98.97 to 118.65 at 106.48. Nonetheless, break of 112.41 will turn focus back to 114.49 resistance instead.

In the bigger picture, the corrective structure of the fall from 118.65 suggests that rise from 98.97 is not completed yet. Break of 118.65 will target a test on 125.85 high. At this point, it's uncertain whether rise from 98.97 is resuming the long term up trend from 75.56, or it's a leg in the consolidation from 125.85. Hence, we'll be cautious on topping as it approaches 125.85. If fall from 118.65 extends lower, down side should be contained by 61.8% retracement of 98.97 to 118.65 at 106.48 and bring rebound.