EUR/USD, USD/JPY and AUD/USD Forecast – US Dollar Drifts Lower on Wednesday

EUR/USD Technical Analysis

The euro has bounced a little bit during the early hours here on Wednesday as the 1.16 level is starting to offer significant support. This is an area that has previously been significant resistance, and therefore, one would assume there is a certain amount of market memory here, and that’s what we’ve seen so far.

I also recognize that the 50 day EMA underneath is sitting right around the 1.15 level. So, I think this is a zone of support if you will. If we were to break down below there, then that could change some things. But right now, I think this makes perfect sense that the buyers have returned.

USD/JPY Technical Analysis

The US dollar looks as if it is struggling a bit against the Japanese yen, but we did break out and I think a short term pullback makes a certain amount of sense. But I think the 200 day EMA and the 148 yen level, which is essentially the same thing at the moment, make a lot of sense as a potential support level, just as we had seen in the euro against the US dollar. I’m looking for a short-term drop and then a bounce that I can take advantage of to start buying again.

AUD/USD Technical Analysis

The US dollar is fighting a little harder against the Australian dollar as the Aussie initially rallied, but as soon as it got close to the 0.6550 level, it gave up some of its momentum. We do have the 50-day EMA sitting underneath that offers support as well, as the bottom of the overall up-trending channel. I think both of these are probably more likely than not to keep the market somewhat afloat.

If we were to break down below the 50-day EMA, then the 200-day EMA near the 0.6450 level is your next support level, and anything underneath there probably allows the Aussie to truly drop. If we can break above the 0.6550 level, then it’s possible that we could go looking to the 0.66 level after that. That would just be a continuation of the channel, which has been in effect since late April.

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