EUR/USD Technical Analysis
The Euro initially rallied during the early hours on Tuesday, but as you can see, has turned things around to show signs of negativity. That being said, the market is probably waiting for the Thursday ECB meeting to get a little bit more clarity, and it is most certainly overbought. So, it would not surprise me at all to see the euro pull back.
The question, of course, is what’s going to happen at the 1.12 level, an area that previously had been massive resistance. If that holds, then it will just simply be more consolidation. On the other hand, if we do rally from here, the market will be eyeing the 1.15 level for major resistance.
USD/JPY Technical Analysis
The dollar has gone back and forth against the Japanese yen during trading on Monday and then again, here early on Tuesday. This is a market that’s trying to find its bottom. And it is probably worth noting that the yen is starting to sell off a bit against other currencies. So, this might be more of a yen story at the moment. But nonetheless, if we can clear the 145 yen level to the upside, it’s likely that we will see a bit of follow through. The 140 yen level underneath is probably your next major support level.
AUD/USD Technical Analysis
The Australian dollar has rallied again in early trading on Tuesday, but quite frankly, this currency pair is the poster child of an overbought currency situation. After all, this assumes that China is just suddenly going to have smooth things over with the United States and vice versa because the Australian dollar, of course, is highly sensitive to the Chinese situation.
Furthermore, we have the 200 day EMA sitting just above the 0.64 level, an area that’s been resistance multiple times. And we got here pretty quickly. So, we’ll have to wait and see how this plays out. Signs of exhaustion could very well lead to selling towards the 0.62 level.
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