EUR/USD, USD/JPY and AUD/USD Forecast – US Dollar Seems to Be Fighting Back

EUR/USD Technical Analysis

The euro has drifted a little bit lower in early trading on Wednesday as we continue to see a lot of noisy behavior. That being said, this is a market that I think will continue to be range-bound, I think the 1.05 level above is obviously a barrier, while the 1.02 level underneath is obviously support. This is a market that has been in significant consolidation for basically two and a half years, and then we’ve recently broken down below there.

The question is, can we break down below 1.02? I do think eventually we probably look for the parity level, but the question is, can we stay in the consolidation between now and then? At this point, I’d say it looks more likely than not, but this is a very quiet pair.

USD/JPY Technical Analysis

The US dollar has initially fallen against the Japanese yen, but it’s turned right back around to show signs of life. We are sitting right around the crucial 200-day EMA, and I think at this point in time, we are in the process of trying to form a little bit of a double bottom.

The 150 yen level underneath I think continues to be a major support level, and as long as we stay above there, I still am a little bit more biased to the upside, although I recognize that the Bank of Japan is more hawkish than it once was.

AUD/USD Technical Analysis

The Australian dollar continues to hang around the 0.6350 level, as it doesn’t really look like we know what to do yet. I’m waiting to see where the next impulsive candlestick takes us. I suspect it will be to the downside, but I don’t want to try to “front run” it. I’d rather be proven correct.

With that being said, we’re at the top of the range that we’ve been in for quite some time with 0.62 underneath being a potential target if we break down. If we turn around and rally, once we get above the 0.64 level, then I have to start to reassess the entire trend. Until then, I have to assume more of the same occurs.

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