Daily Currency Outlook: EUR/USD And USD/JPY : August 30,2018
ActionForex | Aug 30, 2018 05:01AM ET
EUR/USD Daily Outlook
Daily Pivots: (S1) 1.1668; (P) 1.1690; (R1) 1.1728;
Intraday bias in EUR/USD remains neutral at this point as consolidation continues below 1.1733 temporary top. At this point, further rise cannot be ruled out yet. But we’d continue to expect strong resistance from 38.2% retracement of 1.2555 to 1.1300 at 1.1779 to limit upside, at least on first attempt, to bring near term reversal. On the downside, break of 1.1529 minor will indicate completion of the rebound and turn bias to the downside for retesting 1.1300 low. After all, consolidation from 1.1300 will extend for a while before completion.
In the bigger picture, a medium term bottom should be in place at 1.1300, on bullish convergence condition in daily MACD and some consolidations would be seen. But still, note that EUR/USD was rejected by 38.2% retracement of 1.6039 (2008 high) to 1.0339 (2017 low) at 1.2516. That carries some long term bearish implications. Thus, we’d expect fall from 1.2555 high to resume after consolidation completes. Below 1.1300 should send EUR/USD through 61.8% retracement of 1.0339 to 1.2555 at 1.1186. And, in that case, EUR/USD would head to retest 1.0339 (2017 low).
USD/JPY Daily Outlook
Daily Pivots: (S1) 111.23; (P) 111.53; (R1) 111.98;
Intraday bias in USD/JPY remains on the upside as rebound from 109.76 is in progress for 112.14 resistance. Note again that correction from 113.17 should have completed at 109.76 already. Break of 112.14 should target a test on 113.17 high. On the downside, however, break of 110.93 minor support will dampen the bullish case and turn focus back to 109.76 instead.
In the bigger picture, corrective fall from 118.65 (2016 high) should have completed with three waves down to 104.62. Decisive break of 114.73 resistance will likely resume whole rally from 98.97 (2016 low) to 100% projection of 98.97 to 118.65 from 104.62 at 124.30, which is reasonably close to 125.85 (2015 high). This will stay as the preferred case as long as 109.36 support holds. However, decisive break of 109.36 will mix up the outlook again. And deeper fall should be seen back to 61.8% retracement of 104.62 to 113.17 at 107.88 and below.
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