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Daily Pivots: (S1) 0.9842; (P) 0.9878; (R1) 0.9914; More...

Intraday bias in USD/CHF remains neutral first. On the downside, break of 0.9825 will indicate that fall from 1.0056 is correcting whole rise from 0.9186. In that case, deeper decline would be seen to 0.9724 fibonacci level before completion. On the upside, above 0.9982 minor resistance will suggest that the pull back is finished and bring retest of 1.0056.

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.

Daily Pivots: (S1) 108.92; (P) 109.32; (R1) 109.93; More...

Intraday bias in USD/JPY remains neutral with focus on 109.82 minor resistance. Break there will indicate completion of the pull back from 113.39. And that will revive the bullish case that rise from 104.62 is still in progress. Retest of 111.39 should be seen first. On the downside, though, break of 108.10 will extend the fall from 108.10 to 61.8% retracement of 104.62 to 111.39 at 107.20 instead.

In the bigger picture, at this point w;'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 week 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.

Daily Pivots: (S1) 1.2920; (P) 1.2962; (R1) 1.2996; More.....

Intraday bias in USD/CAD remains neutral at this point. For now, as long as 1.2728 support holds, we'll stay slightly bullish in the pair and expect further rally. Above 1.3046 will resume the rise from 1.2526 and target 1.3124 high next. Nonetheless, break of 1.2728 will indicate completion of the rebound from 1.252. And in that case, deeper fall would be seen back to 1.2526 and below.

In the bigger picture, we're favoring the case that that rebound from 1.2061 has not completed yet. But there is no follow through upside momentum so far. Focus remains on 38.2% retracement of 1.4689 to 1.2061 at 1.3065. Sustained trading above there will confirm medium term bullish reversal. That is, down trend from 1.4689 has completed at 1.2061 already. In that case, next target will be 61.8% retracement at 1.3685. However, break of 1.2526 support will dampen this bullish view again. And, focus will be back on 1.2061 key support level, which is close to 50% retracement of 0.9406 (2011 low) to 1.4689 (2015 high) at 1.2048.

Daily Pivots: (S1) 0.7531; (P) 0.7553; (R1) 0.7590; More...

AUD/USD rises to as high as 0.7621 so far as rebound from 0.7411 resumed. Intraday bias is back on the upside further rally. But such rebound is viewed as a correction. Hence, we'd expect strong resistance from 38.2% retracement of 0.8135 to 0.7144 at 0.7688 to limit upside. On the downside, below 0.7475 will bring retest of 0.7411 low first. Break will resume the larger decline from 0.8135 to cluster support at 0.7328 (61.8% retracement of 0.6826 to 0.8135 at 0.7326).

In the bigger picture, medium term rebound from 0.6826 is seen as a corrective move. Prior break of 0.7500 key support suggests that such correction is completed at 0.8135. Deeper decline would be seen back to retest 0.6826 low. In case of another rise, we'd expect strong resistance from 38.2% retracement of 1.1079 to 0.6826 at 0.8451 to limit upside to bring long term down trend resumption eventually.

Australian dollar opens the week higher as lifted by stronger than expected retail sales today. That's followed by Euro as the second strongest as European political risks receded. As sentiments improved, Yen stays soft against all others, followed by the Swiss Franc. While trade tensions occupy a lot of headlines, the impact on the markets is pretty muted.

G7 expressed unanimous concern and disappointment on US trade measures, urged decisive action

In the Chair's summary of the two days meeting of the G7 finance ministers and central bank governor's over the weekend, it's written that there was unanimous concern over recent trade actions of the US. The statement said that "concerns were expressed that the tariffs imposed by the United States on its friends and allies, on the grounds of national security, undermine open trade and confidence in the global economy." And, "Finance Ministers and Central Bank Governors requested that the United States Secretary of the Treasury communicate their unanimous concern and disappointment."

Also, there was exchanges on the benefits of an open rules-based trading system. At the same time "many highlighted the negative impact of unilateral trade actions by the United States". And the finance ministers and central bank governors urged to continue the discussion at the "leaders' Summit in Charlevoix, where decisive action is needed", "to restore collaborative partnerships to promote free, fair, predictable and mutually beneficial trade." It also noted that "members continue to make progress on behalf of our citizens, but recognize that this collaboration and cooperation has been put at risk by trade actions against other members."

Canadian PM Trudeau: Idea of Canada being security threat to US is insulting and unacceptable

Canadian Prime Minister Justin Trudeau said in a TV that "the idea that we are somehow a national security threat to the United States is quite frankly insulting and unacceptable." He added that "the idea that the Canadian steel that's in military, military vehicles in the United States, the Canadian aluminum that makes your, your fighter jets is somehow now a threat?" And, "our soldiers who had fought and died together on the beaches of World War II... and the mountains of Afghanistan, and have stood shoulder to shoulder in some of the most difficult places in the world, that are always there for each other, somehow — this is insulting to them."

China: All agreed in trade talks won't take effect if US imposes sanctions and tariffs

Chinese Vice Premier Liu He and US Secretary of Commerce Wilbur Ross met in Beijing on June 2-3, as follow up to the trade negotiations in Washington back in May. After the meeting, China issued a statement through its state news agency Xinhua. In the statement, it's noted that "to implement the consensus reached in Washington, the two sides have had good communication in various areas such as agriculture and energy, and have made positive and concrete progress while relevant details are yet to be confirmed by both sides". And China reiterated its "consistent" stance that "reform and opening-up as well as expanding domestic demand are China's national strategies. Our set pace will not change."  But it also warned that "all economic and trade outcomes of the talks will not take effect if the US side imposes any trade sanctions including raising tariffs."

China regrets EU's WTO complaint on patent rights

The European Commission lodged a complaint to the WTO against China last week over its breach of patent rights of European companies. That came along side EC's complaint against US steel and aluminum tariffs. Chinese Ministry of Commerce responded to the complaint over the weekend, saying that it regrets the complaint and said it will handle it through WTO dispute settlement. At this same time the MOFCOM said "The Chinese government has always attached great importance to the protection of intellectual property rights and adopted many powerful measures to protect the legitimate rights and interests of domestic and foreign intellectual property rights holders. The achievements have been obvious to all. In terms of intellectual property cooperation, China and the EU have established a working group mechanism for intellectual property rights. Through this mechanism, China and the EU have maintained effective communication and achieved positive results in many areas."

Iran urged JCPOA signatories to stand up to US bullying

Iranian Foreign Minister Mohammad Javad Zarif called on his counterparts to save the JCPOA Iran nuclear deal in letter that's partly published by the state news agency IRNA. Zarif emphasized that the deal was the result of "meticulous, sensitive and balanced multilateral talks" and could not be renegotiated as the US requested. And, he urged the remaining signatories, France, Germany, Britain, Russia and China to stand up to US "illegal withdrawal" and its "bullying methods to bring other governments in line".

Australian Dollar lifted by positive economic data

Retail sales rose 0.4% mom in April versus expectation of 0.3% mom, and prior month's 0.0%. The Australian Bureau of Statistics noted that cafes, restaurants and takeaways led the rise assisted by an unusually warm April. But there were likely negative impacts for some businesses in "clothing, footwear and personal accessories and department stores." Company gross operating profits rose 5.9% qoq, 5.8% yoy seasonally adjusted in Q1. Wage growth was slow at 0.8% qoq seasonally adjusted and 5.1% yoy. TD securities inflation gauge, however, was flat 0.0% mom in May versus expectation of 0.3% mom and prior month's 0.5% mom.

Australia, Canada and UK data to watch this week

Looking ahead, it's a big week for Australia. RBA rate decision will be watched closely but it's unlikely to change it's neutral stance. GDP and trade balance will also be released while China trade balance will be featured. Canada is another focus with trade balance, Ivey PMI and employment featured. Meanwhile, Sterling trades, as well as BoE policy makers will look at construction and services PMIs to gauge the strength of rebound in the economy. Here are some highlights for the week ahead:

• Monday: Eurozone Sentix investor confidence, PPI; UK construction PMI; US factory orders
• Tuesday: Australia current account, RBA rate decision; Japan household spending; Eurozone services PMI final, retail sales; UK services PMI; Canada labor productivity; US ISM non-manufacturing
• Wednesday: Japan average cash earnings; Australia GDP; Swiss CPI; Eurozone retail PMI; Canada trade balance, building permits, Ivey PMI; US non-farm productivity, trade balance
• Thursday: Australia trade balance; Japan leading indicators; Swiss unemployment, foreign currency reserves; German factory orders; Eurozone GDP revision; US jobless claims
• Friday: Japan GDP final; China trade balance; German industrial production, trade balance; Canada housing starts, employment

AUD/USD Daily Outlook

Daily Pivots: (S1) 0.7531; (P) 0.7553; (R1) 0.7590; More...

AUD/USD rises to as high as 0.7621 so far as rebound from 0.7411 resumed. Intraday bias is back on the upside further rally. But such rebound is viewed as a correction. Hence, we'd expect strong resistance from 38.2% retracement of 0.8135 to 0.7144 at 0.7688 to limit upside. On the downside, below 0.7475 will bring retest of 0.7411 low first. Break will resume the larger decline from 0.8135 to cluster support at 0.7328 (61.8% retracement of 0.6826 to 0.8135 at 0.7326).

In the bigger picture, medium term rebound from 0.6826 is seen as a corrective move. Prior break of 0.7500 key support suggests that such correction is completed at 0.8135. Deeper decline would be seen back to retest 0.6826 low. In case of another rise, we'd expect strong resistance from 38.2% retracement of 1.1079 to 0.6826 at 0.8451 to limit upside to bring long term down trend resumption eventually.

Economic Indicators Update

In the Chair's summary of the two days meeting of the G7 finance ministers and central bank governor's over the weekend, it's written that there was unanimous concern over recent trade actions of the US.

The statement said that "concerns were expressed that the tariffs imposed by the United States on its friends and allies, on the grounds of national security, undermine open trade and confidence in the global economy."

And, "Finance Ministers and Central Bank Governors requested that the United States Secretary of the Treasury communicate their unanimous concern and disappointment."

Also, there was exchanges on the benefits of an open rules-based trading system. At the same time "many highlighted the negative impact of unilateral trade actions by the United States". And the finance ministers and central bank governors urged to continue the discussion at the "leaders' Summit in Charlevoix, where decisive action is needed", "to restore collaborative partnerships to promote free, fair, predictable and mutually beneficial trade."

It also noted that "members continue to make progress on behalf of our citizens, but recognize that this collaboration and cooperation has been put at risk by trade actions against other members.

Full statement here.

Canadian Prime Minister Justin Trudeau said in a TV that "the idea that we are somehow a national security threat to the United States is quite frankly insulting and unacceptable."

He added that "the idea that the Canadian steel that's in military, military vehicles in the United States, the Canadian aluminum that makes your, your fighter jets is somehow now a threat?" And, "our soldiers who had fought and died together on the beaches of World War II... and the mountains of Afghanistan, and have stood shoulder to shoulder in some of the most difficult places in the world, that are always there for each other, somehow — this is insulting to them."

https://www.youtube.com/watch?v=IBgGjoGof6A

Chinese Vice Premier Liu He and US Secretary of Commerce Wilbur Ross met in Beijing on June 2-3, as follow up to the trade negotiations in Washington back in May. After the meeting, China issued a statement through its state news agency Xinhua.

In the statement, it's noted that "to implement the consensus reached in Washington, the two sides have had good communication in various areas such as agriculture and energy, and have made positive and concrete progress while relevant details are yet to be confirmed by both sides".

And China reiterated its "consistent" stance that "reform and opening-up as well as expanding domestic demand are China's national strategies. Our set pace will not change."

But it also warned that "all economic and trade outcomes of the talks will not take effect if the US side imposes any trade sanctions including raising tariffs."

Iranian Foreign Minister Mohammad Javad Zarif called on his counterparts to save the JCPOA Iran nuclear deal in letter that's partly published by the state news agency IRNA.

Zarif emphasized that the deal was the result of "meticulous, sensitive and balanced multilateral talks" and could not be renegotiated as the US requested.

And, he urged the remaining signatories, France, Germany, Britain, Russia and China to stand up to US "illegal withdrawal" and its "bullying methods to bring other governments in line".

The European Commission lodged a complaint to the WTO against China last week over its breach of patent rights of European companies. That came along side EC's complaint against US steel and aluminum tariffs.

Chinese Ministry of Commerce responded to the complaint over the weekend, saying that it regrets the complaint and said it will handle it through WTO dispute settlement. At this same time the MOFCOM said "The Chinese government has always attached great importance to the protection of intellectual property rights and adopted many powerful measures to protect the legitimate rights and interests of domestic and foreign intellectual property rights holders. The achievements have been obvious to all. In terms of intellectual property cooperation, China and the EU have established a working group mechanism for intellectual property rights. Through this mechanism, China and the EU have maintained effective communication and achieved positive results in many areas."