EUR/USD, USD/JPY and AUD/USD Forecast – US Dollar Drifts Lower After Jobs Number

EUR/USD Technical Analysis

The euro has skyrocketed again during the trading session on Friday, despite the fact that we had formed a shooting star on Thursday. You can’t chase the trade right now. It’s just far too gone at this point. You would be trying to buy the euro after it has rallied 350 pips in four days. Most of you know that this is a pair that will put you to sleep on any given day. So, if you believe in the longer term interest rate story here with bond yields in Europe exploding, then you would anticipate also that they will have to calm down. They will have to pull back.

You need to watch the German Bund and see how yields behave there and once they start pulling back, you will see the Euro pullback. What you’re looking for is a bounce there, which causes a bounce here after the pullback. At this point, the 1.0933 level is your next major swing high. We still haven’t broken that. We’ll have to see whether or not that plays out. But clearly the Euro is very strong.

USD/JPY Technical Analysis

Interestingly enough, the US dollar has fallen against the Japanese yen as well. However, the Japanese yen has given back some of its gains as I record this. So, whether or not we bounce remains to be seen. It still looks like the yen wants to get to 145 yen, but we’ll have to wait and see about that. As far as buying the dollar is concerned, I would need to see the 150 yen level recaptured, which would take a couple of days at best anyway, so there is not a lot to do here other than to either look for shorting opportunities or wait to see if things turn around.

AUD/USD Technical Analysis

The Australian dollar is one of the more interesting currency pairs I’m watching right now. And you can take the information from this video for the Australian dollar and extrapolate it out to the New Zealand dollar as well. The Australian dollar has fallen and while it did bounce a little bit after the jobs number, it didn’t bounce that much.

So, I think the Australian dollar is probably going to continue to be very weak, not necessarily just against us dollar, but probably against most currencies. And in this setup, the most obvious one would be buying the euro and selling the Australian dollar for going to the US dollar altogether. However, in this particular pair, we are hanging around the 50 day EMA. So, we’ll see if that comes into play. But for me, it looks like the Aussie is just really lacking momentum at the moment, and that’s something to pay attention to.

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