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Barclays Research discusses EUR/CHF outlook and adopts a mostly flat profile, targeting the cross at 1.15 by end of Q3, and at 1.16 by year-end.

"We envision less EURCHF appreciation over the forecast horizon. While we expect the SNB to maintain its commitment to intervene in FX markets to curb unwanted CHF appreciation, we no longer find the franc as materially overvalued even after the recent appreciation in May.

An escalation of protectionist rhetoric and subsequent worsening in risk sentiment adds upside risks to CHF, once again testing the SNB’s commitment to a weaker CHF, in the context of an ever-growing balance sheet (c.120% of GDP in Q1 18)," Barclays argues. 

Corrects typo in line 6

• GBP/USD weak into NY close, ending session 1.3260 +0.11%
• Pair backs away from Europe high 1.3315, trades 1.3302-1.3249 in NY
• Hawkish BoE lean aids GBP/USD rise, Pair needs follow-through on data
• Resistance at 30-DMA 1.3354 & Jun 7 high 1.3472, 200-DMA 1.3602 caps
• EUR/GBP ends NY +0.33% at 0.8791, NY range 0.8791-0.8756
• EZ, German PMI beats lift euro, Salvini EUR comments on BBG temper rise

The stage may be set for a big USD/JPY break lower, based on plummeting volatility, which is now near levels that preceded big moves in the past.
The pair has wandered directionless amid conflicting signals from risk aversion over trade-war fears and Fed-BOJ policy divergence.
Now, though, USD/JPY 21-day historical volatility is down to 5 -- near the the May, January and October nadirs at 4.95, 4.75 and 4.55. Those levels preceded sharp rebounds in volatility combined with a yen jump versus the dollar.
Disappointing Philly Fed and Markit Flash PMI readings may also hint at a data flow to support such a move. Trump's tariffs tweet today nL1N1TO0RJ also weighs.
A USD/JPY sell-off could get help from USD long profit-taking after EUR/USD held key 1.15 support and a big bearish divergence by the USD index.
May's low and high at 108.11 and 111.40 are initial vol spike targets, but a downtrend line from 2015 at 111.77, on EBS, looms large above.
A sub-109.84 close today would warn of at least a retest of May's lows.

ANZ Research adopts a tactically neutral view EUR/USD and mildly bearish on USD/JPY in the near-term.

"We expect EUR/USD to stabilise as: a) we have likely seen the bulk of the adjustment already (markets are now pricing just 10bp of a hike in December 2019, which is fairly dovish); and b) EUR/USD is now trading below fair value for the first time in a year (with 1.5–2% risk premium). For this cross to perform a sustained rebound, though, strength in the data flow is needed," ANZ argues. 

"While the yield differential plays in favour of the USD, heightened uncertainty around trade, which is keeping markets nervous, suggests the importance of rates as a driver of the JPY is set to diminish. Importantly, the JPY remains cheap relative to our expectations and, with heightened volatility likely to remain a feature of markets, we think more JPY strength is in store," ANZ adds. 

Even after Thursday's surprisingly hawkish BoE vote to hold rates steady, sterling may still struggle. Though futures show expectations for an August hike have risen to 50 percent today from 38 percent before the BoE meeting, the UK short-sterling curve is flattening, suggesting the market doesn't see the potential for UK rates to rise very far. Indeed, while short-sterling futures indicate the BoE will still be hiking after the Fed finishes its current hike cycle in December 2019, the rise in UK rates will be shallow and U.S. rates will still be double those in Britain by December 2021, according to the Eurodollar strip.
With that in mind, the recent GBP/USD rise should be seen as a mere short-covering rally.
Cable hovers below Friday's 1.3315 high by 1.3290, after Thursday's surprise rise in the BoE's hike vote.
A close above the weekly cloud top at 1.3256 would give the bulls some momentum, but bears will only become concerned with a close above the 30-DMA at 1.3356, which has capped GBP/USD since the April move lower.
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MUFG Research discusses GBP/USD outlook and expects some modest gains in the near-term.

"Even after yesterday’s appreciation, GBP/USD remains 7.5% lower than the peak set in April and we continue to expect a period of consolidation at these levels with scope for some modest appreciation if the data is viewed as consistent with a rate hike in August.

That remains our call at this stage and with leveraged long GBP speculative positioning as a percentage of open interest below average, we see scope for some modest GBP gains ahead. Option flow data also indicates recent more extreme negative GBP sentiment," MUFG argues. 

• Cable met headwind at 1.3315 after vaulting 1.3300 (early Europe high)
• 1.3280 = subsequent pullback low. 1.3315 = 61.8% of 1.3446-1.3102
• 1.3446 was June 14 high after UK retail sales beat, pre-ECB rate guidance
• 1.3102 = Thursday's 7mth low, before 6-3 MPC rate vote shock boosted GBP
• 1.3270 (Thursday's high) is now a support level. 1.3242 was Asia low
• Airbus says no-deal Brexit would threaten its role in UK nL8N1TN6U6

• Short-covering aids AUD/USD rise to four-day high of 0.7437
• 0.7437 is just over 100 pips above Thursday's one-year low
• Risk-sensitive AUD benefiting from modest rise in risk appetite
• Pan-European STOXX 600 +0.6% nL8N1TO17V. Ldn copper +0.55% nL4N1TO2VP
• S&P e-mini +0.5%. AUD/USD resistance levels 0.7455 and 0.7480
• 0.7455 was Monday's high. 0.7480 was last Friday's high (June 15)

New Zealand's central bank is almost certain to be dovish at its interest rate setting meeting on June 28 and trigger a big NZD/USD drop.
Speculation that the U.S. and China may find a more amicable trade deal has led to a modest relief rally, with the NZD/USD recovering from its slide at the start of the week.
Yet with the greenback now backed by higher interest rates than the kiwi, the reaction to good news should be to sell NZD/USD not buy.
Old habits die hard though and independent of the USD, the NZD is still the highest-yield developed market currency so buying today has followed on the perception that better news could be in the offing.
That may well have set NZD/USD up for a fall with new RBNZ governor Adrian Orr likely to repeat the dovish line he offered at his first address just a few weeks ago nS9N1SG004nL3N1SH271.
Should that trigger a break of last year's low at 0.6781, NZD bulls will be very hard to find.

• EUR/USD reaches min tech correction of fall for Jun 14 ECB 1.1853 high
• 38.2% 1.1853-1.1508 drop is 1.1640. 50/61.8% same move 1.1681/1.1721
• Weaker CNY looks an instrumental factor supporting EUR/USD nL1N1TO067
• Rates, often ignored, suggest there is good reason to pick tops nL1N1TN0CA
• US/10 years yield spread now 257bp, widest in 2018/since 1988 is 259bp
• Close over 21-DMA 1.1672 suggests Apr/Jun drop over, 1.19/1.20 potential

• Strong Thurs recovery from a new trend low and a reversal signal
• Key day, higher high lower lower and a close abv prev close
• Looking for bull confirmation today: close above 1.3243 to complete
• Fourteen-day bear momentum fading and stochs bullishly aligned
• Bid at 1.3215 but could be left behind if a new trend develops
• Potential weekly hammer too as recovery takes price to new high for the week

The beaten-up Aussie dollar may well be a good buy at these levels, as rumours surface that the US and China are to resume trade talks.
Overnight Bloomberg cited three people familiar with the plans as saying negotiations may resume soon as officials race towards a July 6 deadline.
The AUD has taken the strain of global trade frictions as well as emerging Asian market angst on both the trade front and concerns over rising US interest rates.
But along with a possible easing of trade tensions, the low reading from the Philly Fed survey overnight has introduced a note of uncertainty into US growth prospects and potential Fed rate hikes nL1N1TN0GG.
Add to that Australian growth that continues to beat expectations with GDP growing at 3.1% annually in the first quarter, its strongest reading in 2 years nL3N1T81C5.
Lastly there is clear, long-term technical support less than 1% from these levels, so risk/reward is good - 0.7327 is the 61.8 Fibo of the rally from Jan 2016 to Jan 2018 and 0.7329 was the May 2017 low, so it is very clear where this trade would be wrong.

EUR/USD: Neutral (since 05 Jun 18, 1.1700): Dip below 1.1505 not ruled out but weakness is unlikely to be sustained.

We have held the same view since Wednesday (20 Jun, spot at 1.1585) that “a dip below 1.1505 not ruled out but weakness is unlikely to be sustained”. EUR briefly touched 1.1507 yesterday before staging a robust recovery. The price action reinforces our view that EUR is not ready to reenter a bearish phase just yet. That said, only a break back above 1.1680 (‘key resistance’ level remains unchanged) would indicate that the current downward pressure has eased. Until then, there is still risk for a dip below 1.1505 but the prospect for such a move is not high now.

GBP/USD: Bearish (since 20 Jun 18, 1.3175): Bearish phase appears to be close to ending.

We highlighted on Wednesday (20 Jun, spot at 1.3175) that while the outlook for GBP is bearish, the major 1.3040 level is “likely out of reach” and added “1.3100 is already a strong support”. GBP briefly touched 1.3102 yesterday before rocketing to hit an overnight high of 1.3270. The high was not far from the 1.3290 ‘stop-loss’ level for our bearish view and based on the price action yesterday, a break of 1.3290 would not be surprising at all. In other words, the current bearish phase appears to be close to ending. Looking ahead, a break of 1.3290 would not suggest a bullish reversal but the start of a neutral consolidation phase.

AUD/USD: Bearish (since 20 Jun 18, 0.7385): Decline reaching oversold, weakness likely limited to 0.7330, 0.7300. No change in view.

As highlighted yesterday, while the outlook for AUD is bearish, the decline that started last week is already approaching oversold levels. However, further weakness is not ruled but at this stage, we are seeing strong support at 0.7330 followed by 0.7300. In view of the oversold conditions, any weakness is expected to be slow and grinding and the two levels mentioned earlier are expected to offer solid support. In other words, we do not expect AUD to ‘accelerate’ lower. On the upside, only a break of the ‘stop-loss’ at 0.7455 (level previously at 0.7490) would indicate that a short-term low is in place.

NZD/USD: Neutral (since 22 May 18, 0.6945): Shift to bearish if NY close is below 0.6850. No change in view.

The continuing sharp decline in NZD yesterday came as a surprise (NZD closed lower for the fifth straight day, down by -0.55%). Downward momentum has improved considerably and the odds for a sustained break below the year-to-date low of 0.6850 have increased. In other words, a clear break of 0.6850 (say a NY close below this level) would indicate that NZD has entered a bearish phase (targeting a move to the 2017 low of 0.6780). This scenario appears likely unless NZD can reclaim the ‘key resistance’ at 0.6945 (level previously at 0.6990).

USD/JPY: Neutral (since 21 Feb 18, 107.35): USD has likely moved into a broad consolidation phase.

USD edged above the top of our expected 109.10/110.65 consolidation range but slumped after touching a high of 110.75. The price action reinforces our current neutral view and we continue to expect USD to trade sideways, still likely within a 109.10/110.65 range.

• +0.1% with AUD/JPY +0.2%, as risk bargain hunters/profit taking leads
• US officials attempting to restart China trade talks ahead of 6 July tariffs
• Cross trades towards base of a 80.50/84.50 range in place since mid Feb
• Close below 80.45 to target 79.30, 61.8% 2016/17 rise - range should hold
• Tight horizontal daily cloud, Tenkan & Kijun lines do not suggest a trend
• Earlier 80.96 low & London 81.57 high initial support/resistance

• AUD/USD up 0.2% to 0.7392 as USD continues to back-off in early Asia trade
• Risk ccys stay nervous but rumours of US-China meeting on trade calm nerves
• Break above 0.7394 Thurs high would end current run of lower highs at 7 days
• Initial May low at 0.7413 the next hurdle, break suggests some stability
• Close above far off 10 DMA at 0.7461 negates downside suggests base in place
• Long term support remains at 61.8 Fibo at 0.7327, May 2017 low at 0.7329

• Flat after closing +0.6%, leading USD lower on hawkish Haldane nL8N1TN3AA
• Germany's BDI warned UK is heading for a disorderly Brexit nL8N1TN3XA
• Hard to see sustained GBP strength without a Brexit breakthrough
• Bullish outside day & potential key day reversal on close above 1.3270 high
• Momentum studies conflict, 5, 10 & 20 DMAs edge lower - net negative setup
• Ldn 1.3102 low & NY 1.3270 high initial support/resistance - close pivotal

• AUD/USD's decline slows as slightly stretched USD advance pauses on p/taking
• Holds above key support @ 0.7327-29; 38.2% of 2016-18 rally, low in May 2017
• Recovery anemic though; initial resistance at 0.7413, the previous low
• Risk sentiment remains fragile as US & China dig in heels on trade conflict
• Asia to consolidate in 0.7350-0.7410 range, APAC stocks to dictate moves

MUFG Research discusses EUR/USD and USD/JPY near-term outlook and adopts a tactical bearish bias on the 2 pairs, expecting EUR/USD to trade in 1.1400-1.1750 range and USD/JPY to trade in a 109-112 range. 

"Investment flows caused by a higher USDJPY in April have stalled, clearly because of the risks in southern Europe in May. Investors may be readjusting their positions again next week. Also, exporters are expected to be covering their underlying demands, and USDJPY upside will likely be capped by Japanese flows. Yet downside for USDJPY has also been firm of late. We do not anticipate a sudden JPY rally," MUFG argues. 

Overall, we judge that risks to the euro remain skewed to the downside in the near-term. The main obstacle to further weakness is that long US dollar positions are becoming more stretched which could dampen upward momentum in the near-term," MUFG adds. 

• New low in Europe, 1.1508 (EBS) trades, bounce ensues, NY opens near 1.1535
• Philly Fed sees big downside surprise, UST yields & US$ trader broadly lower
• EUR/USD nears 1.1935 & stalls, little pullback seen, near day's high late
• Euro zone PMI Fri, 55.0 f/c vs. prior 55.5, if below f/c EUR/USD should sink
• Bears then likely to make a run at 1.1500 & barrier protection there
• Stops below, if run bears will target 1.1300/15 & 1.1000 support areas

• USD/JPY under pressure after stocks roll over, Nasdaq leads lower
• U.S. Supreme Court rules states can force online shoppers to pay sales tax
• Turn lower in tech exposes weakness of broader equity market
• U.S. financials in trouble, XLF at cliff edge
• Support starts at 40 dma (109.80-85) and trendline (109.40-50)
• More here: nW1N1QB017