EUR/USD, USD/JPY and AUD/USD Forecast – US Dollar Bounces Early on Thursday

EUR/USD Technical Analysis

The euro has pulled back just a touch against the U.S. dollar in early trading on Thursday, as we continue to see some questions asked about the region between 1.13 and 1.15. When you look at the longer term chart, the market has been bouncing around between 1.05 and 1.12 for the better part of two and a half years. We have broken out once before to the downside and then turned around and shot straight up in the air.

And now it looks like we are overbought when you look at the last few years and with rates rising in the United States, it is only a matter of time before you would see the US dollar strengthen. If we do break down below the 1.12 level, thereby re-entering the previous consolidation area, we need to keep an eye on the 50 day EMA and then possibly reach a target of 1.0950. Rallies at this point in time are not as interesting for me, unless we get a daily close above the crucial 1.15 level, which would kick off the next leg higher.

USD/JPY Technical Analysis

The US dollar has been all over the place against the Japanese yen, but it must be said it does look like it’s trying to hold its own. If we can recapture the 145 yen level, then it opens up the possibility of breaking above the 50 day EMA and then the 148 yen level. Short term pullbacks are very possible, but I think there is plenty of support underneath to keep this market somewhat afloat, especially as we have major issues in the Japanese bond market. And of course, the interest rate differential still favors the Greenback.

AUD/USD Technical Analysis

The Australian dollar has gone back and forth again during the trading session on Thursday as we continue to see a lot of questions asked about where China goes next, as China goes, so goes the Australian economy. So, with that being said, the market is simply hanging around the 200 day EMA, which is very flat, which tells you there isn’t a whole lot going on here. Really at this point in time, I think we’re just stuck between the 0.6350 level on the bottom and the 0.65 level on the top.

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