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Daily Pivots: (S1) 0.8516; (P) 0.8537; (R1) 0.8551; More...

Intraday bias in EUR/GBP stays on the downside despite today's recovery. Decisive break of 0.8502 low will resume larger decline from 0.8977. On the upside, above 0.8592 minor resistance will mix up the outlook and extend sideway trading.

In the bigger picture, the down trend from 0.9267 (2022 high) is seen as part of the long term range pattern from 0.9499 (2020 high). Firm break of 0.8717 support turned resistance will argue that it has completed with three waves down to 0.8502. Further break of 0.8977 will bring retest of 0.9267 high. Nevertheless, rejection by 0.8717, followed by break of 0.8502 will resume the decline towards 0.8201 (2022 low).

Daily Pivots: (S1) 1.6908; (P) 1.6987; (R1) 1.7058; More...

Intraday bias in EUR/AUD remains on the upside at this point. Current rally is part of the up trend from 1.4281. Next target is 1.7377 projection level next. On the downside, break 1.6737 support is needed to indicate short term topping. Otherwise, outlook will stay bullish in case of retreat.

In the bigger picture, the rise from 1.4281 (2022 low) is in progress. Next target is 100% projection of 1.5254 to 1.6785 from 1.5846 at 1.7377. For now, outlook will stay bullish as long as 1.5846 support holds, even in case of another pull back.

Daily Pivots: (S1) 0.9537; (P) 0.9562; (R1) 0.9576; More...

Outlook in EUR/CHF is unchanged and intraday bias remains neutral. On the upside, break of 0.9647 will resume the rebound from 0.9520. Further sustained break of 0.9670 will be the first sign of bullish reversal and target 0.9840 resistance for confirmation. On the downside, break of 0.9520 will resume the whole fall from 1.0095 towards 0.9407 low.

In the bigger picture, medium term outlook is staying bearish as the pair is capped well below falling 55 W EMA (now at 0.9859). Down trend from 1.2004 (2018 high) is in favor to continue. Sustained break of 0.9407 will target 61.8% projection of 1.1149 to 0.9407 from 1.0095 at 0.9018. For now, this will remain the favored case as long as 0.9840 resistance holds, in case of strong rebound.

RBNZ Assistant Governor Karen Silk said today, "Near term, there are still some risks on the upside to inflation." She further identified the housing market as a significant factor, mentioning, "The OCR track is slightly higher and we're saying potentially retaining rates at a higher level for longer. Probably the biggest driver of that is really housing."

The bank's recent projections indicate that OCR could reach its peak at 5.59% by mid-2024, and then slightly pull back to 5.36% by early 2025. This revised forecast surpasses earlier predictions laid out in the previous Monetary Policy Statement.

Silk expressed uncertainty regarding how the stability observed in the housing market, combined with a potential recovery next year, might impact inflation.

"We are looking at it as a gradual resumption in house price trend," Silk elaborated, "but in an environment where labor market pressures continue to ease and at the same time you've got a higher interest rate environment."

Additionally, Silk pointed out broader concerns beyond the local scenario. "One of the medium-term risks for us is global growth," she said. Expressing a keen interest in international trajectories, she added, "We're really focused on global growth and in particular how weak is China. Is China really going to be able to deliver the growth that they're suggesting?"

Daily Pivots: (S1) 145.46; (P) 146.01; (R1) 146.40; More...

Intraday bias in USD/JPY remains neutral for consolidation below 146.55. On the upside, sustained break of 61.8% projection of 129.62 to 145.06 from 137.22 at 146.76 will pave the way to retest 151.93 high. However, considering bearish divergence conditio in 4H MACD, firm break or 143.88 resistance turned support will be a sign of reversal, and turn bias back to the downside for 55 D EMA (now at 141.79).

In the bigger picture, overall price actions from 151.93 (2022 high) are views as a corrective pattern. Rise from 127.20 is seen as the second leg of the pattern and could still be in progress. But even in case of extended rise, strong resistance should be seen from 151.93 to limit upside. Meanwhile, break of 137.22 support should confirm the start of the third leg to 127.20 (2023 low) and below.

Daily Pivots: (S1) 1.3510; (P) 1.3533; (R1) 1.3568; More....

USD/CAD's rally is still in progress and intraday bias stays on the upside. As noted before, corrective fall from 1.3976 should have completed with three waves down to 1.3091. Further rise would be seen to retest 1.3653 resistance next. Break there will further confirm this case and target 1.3976 high. For now, further rally is expected as long as 1.3371 support holds, in case of retreat.

In the bigger picture, price actions from 1.3976 are viewed as a corrective fall only. Upon completion, rise from 1.2005 (2021 low) would resume through 1.3976 towards 1.4667/89 long term resistance zone. In case of another fall, downside should be contained by 61.8% retracement of 1.2005 to 1.3976 at 1.2758.

Daily Pivots: (S1) 0.6362; (P) 0.6407; (R1) 0.6448; More...

AUD/USD's decline is still in progress and intraday bias stays on the downside. Next target is 100% projection of 0.7156 to 0.6457 from 0.6894 at 0.6195. On the upside, above 0.6479 minor resistance will turn intraday bias neutral and bring consolidations first, before staging another fall.

In the bigger picture, the down trend from 0.8006 (2021 high) could still be in progress. Break of 0.6457 support affirms this bearish case. Further break of 0.6169 will target 61.8% projection of 0.8006 to 0.6169 to 0.7156 at 0.6021. This will now remain the favored case as long as 0.6894, in case of strong rebound.

Daily Pivots: (S1) 0.8761; (P) 0.8785; (R1) 0.8810; More....

Intraday bias in USD/CHF remains neutral and outlook is unchanged. On the upside, sustained trading above 0.8818 support turned resistance will carry larger bullish implication. Further rally should then be seen to 0.9146 cluster resistance next. However, break of 0.8688 support will indicate rejection by 0.8818, and turn bias back to the downside for retesting 0.8551 low.

In the bigger picture, a medium term bottom could be in place at 0.8551 already, on bullish convergence condition in D MACD. Sustained trading above 0.8818 will bring further rise to 0.9146 cluster resistance (38.2% retracement of 1.0146 to 0.8551 at 0.9160), even as a correction. Nevertheless, break of 0.8851 will resume the down trend from 1.0146 instead.

Daily Pivots: (S1) 1.2704; (P) 1.2746; (R1) 1.2789; More...

No change in GBP/USD's outlook as range trading continues. Intraday bias stays neutral at this point. On the downside, firm break of 1.2615, and sustained trading below 1.2678 resistance turned support will argue that it's already in a larger correction. Deeper decline would then be seen to 1.2306 support next. Nevertheless, break of 1.2817 minor resistance will indicate that the pull back from 1.3141 has completed, and turn bias back to the upside for stronger rebound.

In the bigger picture, a medium term top could be in place at 1.3141 already, on bearish divergence condition in D MACD. Sustained trading below 55 D EMA (now at 1.2723) should confirm this case, and bring deeper fall to 38.2% retracement of 1.0351 to 1.3141 at 1.2075, as a correction to up trend from 1.0351 (2022 low). For now, rise will stay mildly on the downside as long as 1.3141 resistance holds, in case of strong rebound.

• Nine-week corrective decline from the 16 June 2023 high has almost reached a key inflection/support level of 31,130.
• Short-term momentum indicates an overstretched down move from the 10 August 2023 minor swing high, increasing the odds of a potential rebound in price actions.
• Intermediate resistances to watch will be at 31,760 and 32,380.

The price actions of the Japan 225 Index (a proxy of the Nikkei 225 futures) have staged the expected corrective decline and tumbled by -3.5% from 2 August to print a current intraday low of 31,248 in today, 18 August Asian session at this time of the writing.

Interestingly, several key elements are now advocating for a potential rebound.

The current decline has almost reached a key inflection/support level of 31,130

Fig 1:  Japan 225 medium-term trend as of 18 Aug 2023 (Source: TradingView, click to enlarge chart)

The current intraday low of 31,248 is now right above the upward-sloping 100-day moving average, former ascending channel resistance from the 9 March 2023 high, and 38.2% Fibonacci retracement of the prior medium-term up move from the 15 March 2023 low to 16 June 2023 high that all confluences with the 31, 130 support.

Downside momentum of current minor down move has shown signs of easing

Fig 2:  Japan 225 minor short-term trend as of 18 Aug 2023 (Source: TradingView, click to enlarge chart)

The most recent down move in place since 10 August 2023 minor swing high of 32,830 has started to ease in terms of momentum analysis as depicted by the bullish divergence condition flashed out today on the hourly RSI oscillator at its oversold region.

Given that the nine-week of corrective decline from the 16 June 2023 high of 34,015 within its major uptrend phase that is still intact has reached close to key support of 31,130 coupled with positive short-term momentum, the Index may see a short-term rebound at this juncture.

Watch the 31,130 short-term pivotal support and a clearance above 31,760 sees the next intermediate resistance at 32,380.

However, failure to hold at 31,130 exposes the next support coming in at 30,720 which is also the former swing high areas of 16 February/14 September 2014.