EUR/USD, USD/JPY and AUD/USD Forecast – Forex Market Quiet on New Years Eve

EUR/USD Technical Analysis

The Euro was fairly quiet during the trading session on Tuesday, as you would expect with most traders not trading. This is an environment that I think will continue to be thought of as very low volume. And therefore, the fact that we are just hanging around the 1.04 level was not a huge surprise. From a longer term and bigger aspect looking at the charts, I would anticipate that the 1.03 level offers support and the 1.06 level will be your ceiling in the market.

USD/JPY Technical Analysis

The US dollar initially fell against the Japanese yen but has turned around to show signs of life. By doing so, it looks like we are going to try to continue to the upside. And I think you’ve got a scenario where traders are going to drive the US dollar to the 158 yen level. If and when we can break above there, that opens up a move to the highs near 161.75 yen.

Short-term pullbacks at this point in time should continue to attract attention as the interest rate differential between the US dollar and the Japanese yen are still a country mile wide. But I think at this point, as long as we stay above the 155 yen level, you just have to think of this as consolidation before the next move higher.

AUD/USD Technical Analysis

The Australian dollar continues to look anemic as, yet again, we are pressuring the 0.62 level. This is a level that is becoming obvious as desperation support. And if and probably when we break down below the 0.62 level, I believe that the Australian dollar continues to plummet, perhaps down to the 0.60 level over the next several weeks. Rallies at this point in time still have to be looked at as suspicious and an opportunity to short the market at the first signs of exhaustion.

The 0.6350 level right now is the ceiling in the market, and that assumes that we can even get anywhere near there. Keep in mind that the Australian dollar continues to suffer at the hands of a slow and sluggish Chinese economy, so it’s not a great look for this currency pair.