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Daily Pivots: (S1) 0.8673; (P) 0.8714; (R1) 0.8744; More...

Despite breaching 0.8750 to 0.8754, EUR/GBP quickly retreated back to established range. Intraday bias stays neutral first as the consolidation from 0.8750 could extend. Near term outlook will remain mildly bullish as long as 0.8602 support holds and further rally is expected. Above 0.8750 will target 0.8786 resistance first. Break of 0.8786 would pave the wave for retesting 0.9304 high. Break of 0.8602, however, will argue that the rebound from 0.9312 has completed and turn bias back to the downside for 0.8529.

In the bigger picture, price actions from 0.9304 are viewed as a medium term corrective pattern. The leg from 0.9304 should have completed after taking 0.8332 structural support. But it's too early to say that larger rise from 0.6935 is resuming. Rejection from 0.9304 will extend the consolidation with another falling leg. Meanwhile, firm break of 0.9304 will target 0.9799 (2008 high). In case of another decline, we'd expect strong support from 0.8116 cluster support (50% retracement of 0.6935 to 0.9304 at 0.8120) to contain downside and bring rebound.

Daily Pivots: (S1) 1.5121; (P) 1.5174; (R1) 1.5253; More...

Intraday bias in EUR/AUD remains on the upside for the moment. Current rise from 1.3624 is expected to target r next medium term fibonacci level at 1.5455. On the downside, break of 1.4927 is needed to signal short term topping. Otherwise, outlook will remain bullish in case of retreat.

In the bigger picture, price actions from 1.6587 medium term top are viewed as a corrective pattern. Such correction should be completed at 1.3624 after defending 1.3671 key support. Rise from 1.3642 is now expected to target 61.8% retracement of 1.6587 to 1.3624 at 1.5455. Sustained break there will pave the way to retest 1.6587. In any case, outlook will now stay cautiously bullish as long as 1.4669 support holds.

Daily Pivots: (S1) 1.0875; (P) 1.0888; (R1) 1.0906; More...

No change in EUR/CHF's outlook as consolidation from 1.0986 continues. Intraday bias stays neutral for the moment. Deeper fall cannot be ruled out. But downside should be contained by 1.0791/0872 support zone to bring rise resumption. As noted before, the consolidative pattern from 1.1198 should be completed. Firm break of 1.0999 resistance will pave the way for a retest on 1.1198 high.

In the bigger picture, the price actions from 1.1198 are seen as a corrective move. Current strong rebound is raising the chance that it's completed after defending 38.2% retracement of 0.9771 to 1.1198 at 1.0653. Decisive break of 1.0999 resistance will target a test on 1.1198 high. For now, this will be the preferred case as long as 1.0791 support holds.

Daily Pivots: (S1) 1.1189; (P) 1.1223 (R1) 1.1244; More....

Intraday bias in EUR/USD remains neutral for the moment. On the upside, break of 1.1267 will resume recent rise. Decisive break of 1.1245/98 (138.2% projection of 1.0339 to 1.0828 from 1.0569 at 1.1245) resistance zone will carry larger bullish implication and target 1.1615 resistance next. In case consolidation from 1.1267 extends with another fall, further rise will remain in favor as long as 1.1020 support holds. But, break of 1.1020 will indicate rejection from 1.1245/98 and turn bias to the downside for 1.0838 support.

In the bigger picture, the case for medium term reversal continues to build up with EUR/USD staying far above 55 week EMA (now at 1.0888). Also, bullish convergence condition is seen in weekly MACD. Focus will now be on 1.1298 key resistance. Rejection from there will maintain medium term bearishness and would extend the whole down trend from 1.6039 (2008 high). However, firm break of 1.1298 will indicate reversal. In such case, further rally would be seen back to 1.2042 support turned resistance next.

Daily Pivots: (S1) 1.2833; (P) 1.2874; (R1) 1.2919; More...

Intraday bias in GBP/USD remains neutral first. With 1.2926 minor resistance intact, deeper fall is still in favor. We're holding on to view that rise from 1.2108 is completed. Below 1.2768 will target 1.2614 resistance turned support next. Break there should also indicate completion of whole consolidation pattern from 1.1946 and target a retest on this low. Meanwhile, above 1.2926 minor resistance will turn focus back to 1.3047 high instead.

In the bigger picture, fall from 1.7190 is seen as part of the down trend from 2.1161. The rejection from 55 week EMA is maintaining bearishness in the pair. Also, at this point, as long as 1.3444 resistance holds, fall from 1.7190 is still expected to continue. Break of above mentioned 1.2614 support will affirm this bearish case.

Daily Pivots: (S1) 0.9678; (P) 0.9699; (R1) 0.9734; More.....

Further decline is still expected in USD/CHF with 0.9807 resistance intact. Current fall from 1.0342 should target 100% projection of 1.0342 to 0.9860 from 1.0099 at 0.9617. We'll start to look for reversal signal below there. Meanwhile, break of 0.9807 will be the first sign of near term reversal. In such case, intraday bias will be turned back to the upside for 0.9860 support turned resistance for confirmation.

In the bigger picture, USD/CHF is 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.

Daily Pivots: (S1) 110.83; (P) 111.15; (R1) 111.69; More...

USD/JPY's consolidation from 110.23 is extending with another rise and intraday bias stays neutral first. Break of 112.12 might be seen but upside should be limited by 61.8% retracement of 114.36 to 110.23 at 112.78 to bring fall resumption. Below 110.23 will turn bias to the downside and will likely resume the fall from 118.65 through 108.12 low. At fall from 118.65 is seen as a correction, we'll look for bottoming signal again at 61.8% retracement of 98.97 to 118.65 at 106.48. However, sustained break of 112.78 will turn focus back to 114.36 resistance instead.

In the bigger picture, price actions from 125.85 high are seen as a corrective pattern. It's uncertain whether it's completed yet. But in case of another fall, downside should be contained by 61.8% retracement of 75.56 to 125.85 at 94.77 to bring rebound. Overall, rise from 75.56 is still expected to resume later after the correction from 125.85 completes.

Daily Pivots: (S1) 0.7347; (P) 0.7400; (R1) 0.7429; More...

Intraday bias in AUD/USD remains mildly on the downside for 0.7328 support. Recovery from 0.7328 should have completed at 0.7516 after failing to sustain above 55 day EMA. Break of 0.7328 will resume whole fall from 0.7748 to 0.7144/7158 support zone. On the upside, break of 0.7516 resistance will indicate near term reversal and turn bias back to the upside.

In the bigger picture, we're still treating price actions from 0.6826 low as a corrective pattern. And, as long as 38.2% retracement of 0.9504 to 0.6826 at 0.7849 holds, long term down trend from 1.1079 is expected to resume sooner or later. Break of 0.6826 low will target 0.6008 key support level. However, firm break of 0.7849 will indicate that rise from 0.6826 is developing into a medium term rebound, rather than a sideway pattern. In such case, stronger rise should be seen to 55 month EMA (now at 0.8115) and above.

Daily Pivots: (S1) 1.3482; (P) 1.3505; (R1) 1.3538; More....

USD/CAD's consolidation from 1.3387 is still in progress and outlook is unchanged. Intraday bias remains neutral first. Upside of recovery is expected to be limited by 1.3570 resistance to bring another decline. At this point, we're still favoring the case that rise from 1.2968 has completed. And the larger rise from 1.2460 could have finished too. Below 1.3387 will target 1.3222 support first. Break of 1.3222 will affirm our bearish view and target 1.2968 key support level for confirmation. However, break of 1.3570 will turn focus back to 1.3793 high instead.

In the bigger picture, price actions from 1.4689 medium term top are seen as a correction pattern. The first leg has completed at 1.2460. Rise from 1.2460 is seen as the second leg and could have completed at 1.3793, ahead of 61.8% retracement of 1.4689 to 1.2460 at 1.3838. Break of 1.3222 should indicate the start of the third leg while further break of 1.2968 should confirm. Nonetheless, sustained trading above 1.3838 would pave the way to retest 1.4689 high.

Major US indices surged to new record high overnight as boosted by solid ADP job data. Positive sentiments also carry on in Asian session. DOW gained 135.53 pts, or 0.65% to close at 2114.18, a record close even if it's slightly short of record intraday high at 21169.11. S&P 500 rose 18.26 pts, or 0.76% to close at 2430.06. NASDAQ rose 48.31 pts or 0.78% to close at 6264.83. Both were also record close. Nikkei follows in Asia and is trading up 1.4% at the time of writing, at 20140. That's also the first time Nikkei tops 20000 handle since December 2015. Elsewhere, 10 year yield closed up 0.021 at 2.217 but was way off session high at 2.239. Gold struggled to find follow through buying above 1270 again and is back at 1262. WTI crude oil stays soft at around 48.

In the currency markets, Sterling stabilized this week and is trading mildly higher against all other major currencies. In particular, the rebound in GBP/JPY, more thanks to weakness in Yen, suggests short term bottoming at 141.43. But the Pound could stay vulnerable as the election on June 8 approaches. Euro follows as the second strongest major currency for the week on expectation that ECB will tweak its language to the hawkish side in June meeting. Aussie and Loonie are trading as the weakest ones for the week so far, followed by Dollar. The greenback will look into today's non-farm payroll report.

A solid NFP expected with focus on wage

The markets are expecting NFP to show 185k growth in May. Unemployment rate is expected to be unchanged at 4.4%. Average hourly earnings are expected to rise 0.2% mom. Looking at other related data, the "rip-roaring" ADP report suggests that is upside potential in today's NFP. ADP private jobs grew 253k in May, well above expectation of 181k. Four week moving average of initial claims dropped to 238k in the week ended May 27, down from 243k four weeks ago. Continuing claims stayed below 2m handle for all of the May data released so far. Employment component of ISM manufacturing rose slightly to 53.5, up from 52.0. Conference board consumer confidence dropped for the second month to 117.9 in May but the three month average stayed at the highest level since 2001. Overall, there is much prospect of a strong NFP report today. The focus would be on whether such healthy growth in job markets could push up wages.

Trump announced withdrawal from Paris climate accord

Some attributed the surge in stocks to US President Donald Trump's announce to withdraw from the Paris accord on climate change. But we would like to point out that such a move should be well priced in as Trump is just delivering his election promise. And, based on the reactions from European leaders during and after Trump's visit to Europe, it was already clear that the withdrawal was a decision made. So, we'd maintain our view that the surge in stocks was mainly due to optimism on the US economy.

Trump announced US is withdrawing from the Paris climate pact yesterday and said that "we are getting out, but we will start to negotiate and we will see if we can make a deal, and if we can, that's great." Environmentalist reacted to the announcement with anger as many could easily predict. But there were also business leaders who expressed disagreement to the move. Tesla CEO Elon Musk tweeted that his is leaving the presidential councils and warned that "leaving Paris is not goof for America or the world:". Walt Disney CE Robert Iger also resigned from presidential council over the withdrawal, "as a matter or principle". Goldman Sachs CEO Lloyd Blankfein tweeted for the first time ever that the decision was a "setback for the environment and for the US's leadership position in the world".

Elsewhere...

Japan monetary base rose 19.4% yoy in May. Consumer confidence will be released in Asian session. UK will release construction PMI in European session while Eurozone PPI will be featured US and Canada will release trade balance today too. Meanwhile, the main focus is of course on US non-farm payroll.

USD/CAD Daily Outlook

Daily Pivots: (S1) 1.3482; (P) 1.3505; (R1) 1.3538; More....

USD/CAD's consolidation from 1.3387 is still in progress and outlook is unchanged. Intraday bias remains neutral first. Upside of recovery is expected to be limited by 1.3570 resistance to bring another decline. At this point, we're still favoring the case that rise from 1.2968 has completed. And the larger rise from 1.2460 could have finished too. Below 1.3387 will target 1.3222 support first. Break of 1.3222 will affirm our bearish view and target 1.2968 key support level for confirmation. However, break of 1.3570 will turn focus back to 1.3793 high instead.

In the bigger picture, price actions from 1.4689 medium term top are seen as a correction pattern. The first leg has completed at 1.2460. Rise from 1.2460 is seen as the second leg and could have completed at 1.3793, ahead of 61.8% retracement of 1.4689 to 1.2460 at 1.3838. Break of 1.3222 should indicate the start of the third leg while further break of 1.2968 should confirm. Nonetheless, sustained trading above 1.3838 would pave the way to retest 1.4689 high.

Economic Indicators Update