EUR/USD, USD/JPY and AUD/USD Forecast – US Dollar Gives Up Some Ground

EUR/USD Technical Analysis

The Euro initially broke down a bit during the early trading session on Tuesday but then turned around to show signs of strength. We’re currently hanging around just above the 1.08 level, an area that is basically the bottom of the recent consolidation range. With the euro bouncing the way it has, it does suggest to me, all things being equal, that we might see some sideways action for a while as we build a range after that massive shot higher.

USD/JPY Technical Analysis

The US dollar has pulled back against the Japanese yen during the trading session on Tuesday so far, but the 150 yen level is an area that I’ll be watching to see if it can hold as support. It is worth noting that the top of the candlestick touched the 50 day EMA, which of course is an indicator that a lot of people watch to determine trend.

The interest rate differential still favors the US dollar, obviously, but we have seen yields dropping in America, so that is starting to abate just a little bit. If we break down from here, watch the 148 yen level because that is where the massive support should be. If it’s not there, then this pair falls pretty significantly.

AUD/USD Technical Analysis

The Australian dollar has rallied quite nicely against the U.S. dollar breaking above the 50-day EMA and the 0.63 level. The biggest problem, of course, is that the 0.63 level is right dead in the middle of the range, the range being defined from 0.64 on the top to 0.62 on the bottom.

It does look very much like a market that is trying to grind its way higher, but it just doesn’t have the momentum yet. I think you still have plenty of sideways action in the Australian dollar going forward.

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