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US Dollar Gives Back Some of its Gains – EUR/USD, USD/JPY, and AUD/USD Technical Analysis
Updated: Dec 19, 2024, 13:27 GMT+00:00
The US dollar continues to see a lot of noise, but after that massive move during the session on Wednesday, the market looks ready to give back some of the big gains. This doesn’t mean that anything has changed longer-term, but in the short term there seems to be a bit of a “snapback.”
EUR/USD Technical Analysis
The euro has bounced slightly during the early hours on Thursday as what looks to be an oversold condition is starting to get a little bit of a pushback. Ultimately though, I think the 1.05 level will more likely than not end up being a bit of a ceiling. With that being the case, I think you have to assume that market participants will look at this as a fade the rally type of market as they have for a moment now.
So, with that being said, I believe this is a scenario where traders are going to continue to look for weakness in the US dollar to take advantage of cheap greenbacks. But you should also keep in mind that this time of year does get a little bit strange with the lack of liquidity.
USD/JPY Technical Analysis
The US dollar has rallied significantly against the Japanese yen, as we now have both the Federal Reserve and the Bank of Japan out of the way. Now that we are above the 156.50 level, we have cleared another barrier, and short-term pullbacks should continue to attract a certain amount of attention. The 154.50 level underneath should be significant support followed by the 153 level. I have no interest in shorting this pair. You get paid to hang on to it and I think that’s a lot of what people will be paying close attention to.
AUD/USD Technical Analysis
In the Australian dollar, we are starting to see a little bit of a bounce from here, but I think you’ve got a situation where the 0.6350 level will probably end up being a bit of a barrier. With this being the case, I think you’ve got a situation where you are looking to fade the first signs of exhaustion, which has been the way this has played out for a while. Having said all of that, we do have further to go, I think, before we see it. I do think that the market is a little overdone, so a little bit of patience probably goes a long way here so that you can pick up cheap US dollars.
For a look at all of today’s economic events, check out our economic calendar.
About the Author
Christopher Lewisauthor
Chris is a proprietary trader with more than 20 years of experience across various markets, including currencies, indices and commodities. As a senior analyst at FXEmpire since the website’s early days, he offers readers advanced market perspectives to navigate today’s financial landscape with confidence.
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