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

EUR/USD Technical Analysis

The euro has risen just a slight bit during the early hours here on Wednesday as we continue to see a lot of questions asked about the US dollar in general. That being said, I do think we have a situation where traders are going to be wondering what the Federal Reserve is going to do. And that, of course, has a major influence on how they trade in the interest rate market, which by extension, has a major influence on how we trade the US dollar itself.

With that being said, I think you’ve got a market that is trying to do everything it can to reach back into the previous consolidation area, but we are in an area that’s been important for a while. As I record this, we are right around level 1.16, which, of course, is a large, round, psychologically significant figure and an area that, quite frankly, had been very difficult to deal with. So, I think the next day or two probably tells the entire story. As things look now, though, it does look like we are at least trying to rally.

USD/JPY Technical Analysis

The US dollar was a bit noisy against the Japanese yen during early Wednesday trading, but I wouldn’t read too much into the action. It just looks like we are trying to find some type of floor here. If we do, in fact, get that floor, then a break above the 148 yen level sends this market higher, perhaps as high as 151 yen. Pullbacks at this point still look at the 50-day EMA and possibly 146 yen as support.

AUD/USD Technical Analysis

The Australian dollar has rallied quite nicely, but it is coming into quite a bit of noise just above that, I think, will keep it somewhat muted, unfortunately, for those who are bullish on the Aussie. Given enough time, I would anticipate that the Australian dollar could very well sell off if we start to see US dollar strength in general, as the Australian dollar has been one of the weaker performing currencies against the greenback over the last several months, despite the fact that it has been positive.

I prefer to fade signs of exhaustion if and when we get them. I just don’t know if and when we will get them. The 0.6550 level remains a magnet for price. If we break down below the 0.6375 level, then I think the real selling begins.

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