EUR/USD, USD/JPY and AUD/USD Forecast – US Dollar a Touch Sluggish Against Some Currencies

EUR/USD Technical Analysis

The euro rallied slightly in the early hours on Wednesday as we continue to hang around the 1.08 level. The 1.08 level is an area that I think is going to continue to be important. But one thing that I cannot help but notice is that the last couple of candlesticks have formed inverted hammers.

This is a pretty negative turn of events, but you could also say on the other hand, if we were to break above both of those candlesticks, it would be extraordinarily bullish. If we break down below the 1.0750 level, then I think we have a deeper correction ahead of us. Otherwise, I will look for more sideways action here.

USD/JPY Technical Analysis

The US dollar rallied a bit against the Japanese yen during the trading session on Wednesday in the early hours, but it has given back some of the gains once we got close to the 50 day EMA. Because of this, I think we’re still somewhat stuck here trying to figure out where to go next.

There are a lot of headwinds out there around the world for risk appetite, and that is going to be felt acutely in this market. If we turn around and break down below the 148 yen level that could send the pair much lower, perhaps down to the 145 area. If we can break above the 200 day EMA near the 151.50 yen level, then it opens up a move to the 155 yen level.

AUD/USD Technical Analysis

The Australian dollar initially fell and then it rallied and now it’s giving back some of those gains. I think we’re just stuck here, dancing around the 50 day EMA, as we have been in a range for a couple of months and there doesn’t seem to be any real effort to get out of it.

That does make a certain amount of sense because if we are worried about global growth, then it has a direct effect on commodities and China, which in turn has a direct effect on Australia. With that being said, I think at this point range bound traders continue to love this market.

For a look at all of today’s economic events, check out our economic calendar.