Daily Currency Outlook: AUD/USD And USD/JPY : May 31,2018

AUD/USD Daily Outlook

Daily Pivots: (S1) 0.7508; (P) 0.7546; (R1) 0.7616;

Strong rebound in AUD/USD dampens the immediate bearish case and turn intraday bias neutral again. More consolidation would be seen first and above 0.7604 will bring stronger rebound. But still, we’d expect strong resistance from 38.2% retracement of 0.8135 to 0.7144 at 0.7688 to limit upside to bring decline resumption eventually. 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).

AUD/USD 4 Hour Chart

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.

AUD/USD Daily Chart

USD/JPY Daily Outlook

Daily Pivots: (S1) 108.47; (P) 108.78; (R1) 109.20;

A temporary low is in place at 108.10 and intraday bias is turned neutral first. As long as 109.82 minor resistance holds, deeper decline is expected in USD/JPY. Below 108.10 will target 61.8% retracement of 104.62 to 111.39 at 107.20. Break will likely resume larger decline from 118.65 for a new low below 104.62. On the upside, break of 109.82 is needed to confirm completion of the fall from 111.39. Otherwise, near term outlook will be mildly bearish even in case of recovery.

USD/JPY4 Hour Chart

In the bigger picture, USD/JPY remains bounded in medium term falling channel from 118.65 (2016 high). The development. Current deeper than expected fall from 111.39 argues that fall from 118.65 is not finished. Break of 104.62 low would target 98.97 or even below. Though, break of 111.39 will revive the case that fall from 118.65 has completed and turn focus to 114.73 for confirmation.

USD/JPY Daily Chart

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