EUR/USD, USD/JPY and AUD/USD Forecast – US Dollar Softens Early on Monday

EUR/USD Technical Analysis

The euro rallied somewhat in the early hours on Monday as we continue to see a lot of weakness in the euro overall, but perhaps a little bit of profit taking in what would more likely than not end up being a thin session. Regardless, this is a market that has a significant amount of support underneath current trading at the 1.03 level and has a significant amount of resistance at the 1.06 level where the 50-day EMA currently resides. I suspect we will continue to see more back and forth in this 300-point range.

USD/JPY Technical Analysis

The US dollar has pulled back again against the Japanese yen at the 158 yen level. That being said, I do think eventually we break through there and we’re in the process of just simply building up a little bit of momentum to finally take off to the upside.

Underneath we have support, at least in a minor sort of support in the 156 yen, but 155 yen, I think will be much more crucial. Regardless, the interest rate differential continues to favor the US dollar and the bond markets in America continue to see yields rise. As long as that’s the case, this pair should continue to go higher over the longer term.

AUD/USD Technical Analysis

And in the Australian dollar, you can see that the Aussie has bounced somewhat significantly early in the session. But again, this is much like the Euro, it’s a situation where I think we’re just trying to find a range. The 0.6350 level above should be significant resistance. The 0.62 level underneath is significant support.

Nonetheless, and this is even more true with the Australian dollar than it is the euro, I prefer to sell these rallies in this range. I think you have far too many things working for the dollar, and far too many things working against not only the euro, but here in the Australian dollar as well as it has to deal with a sluggish China.

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