EUR/USD, USD/JPY and AUD/USD Forecast – US Dollar Continues to Soften on Monday

EUR/USD Technical Analysis

The euro has initially gapped lower to kick off the trading week on Monday, only to turn around and show signs of life. With that being said, the market looks as if it is still trying to break out to the upside, despite the fact that you would expect a lot of risk off behavior. So, with this, you follow what the market does, not what it should do in theory. So, if we can break to a fresh new high, one would have to assume that the euro continues to strengthen.

USD/JPY Technical Analysis

The US dollar fell against the Japanese yen after initially trying to rally. It looks like that 145 yen level continues to be some type of massive brick wall, if you will, of resistance. This makes me very interested in this level because if we break above there on a daily close, I think it’s going to mean quite a bit. The market participants right now, though, seem to be content with simply grinding sideways between 145 yen on the top and 142 yen on the bottom. With that, we probably continue to have buy on the dip, but it is going to be messy.

AUD/USD Technical Analysis

The Australian dollar has rallied quite nicely against the US dollar. And it looks like we are trying to do everything we can to attempt to break above the crucial 0.6550 level. We aren’t there quite yet. But if we do break above that level, I think you have a real shot at something special happening, as it would be a major breakout.

This is a market that continues to be very noisy. But overall, I think you have to look at it through the prism of one that has a very well defined barrier that if breached is probably going to see people piling into it. At that point in time, I would anticipate that we could be looking at a move to the 0.67 level. Until proven otherwise, this is a market that favors the upside despite the fact that it doesn’t have the momentum to actually break out.

For a look at all of today’s economic events, check out our economic calendar.