EUR/USD, USD/JPY and AUD/USD Forecast – US Dollar Quiet in Early Thursday Trading

EUR/USD Technical Analysis

The euro has been pretty quiet in the pre-market trading hours of Thursday as we’re just hanging around the 1.1750 level. This is a market that I think has to determine what to do with itself from a risk appetite standpoint. The Federal Reserve did cut interest rates last week, but the US dollar is actually stronger than it was when that happened. This is interesting because you’re starting to hear the crescendo of how the dollar is going to fall apart and how it’s going to lose its World Reserve Currency status and the whole nine yards.

Generally speaking, that’s when you’ve seen the bottom in the dollar or you’re getting close to it. The euro is doing nothing to help itself. That being said I would put this in the category of a neutral pair because it’s really not until we break down below the 1.16 level that the attitude truly changes. So, I think we’ve got some sideways action ahead of us here. Maybe with a little bit of an upward tilt still, but that’s definitely starting to fade

USD/JPY Technical Analysis

The US dollar initially pulled back against the Japanese yen but turned around to threaten the 149 yen level again, an area that is the resistance at the top of a consolidation zone. The consolidation zone spanning from 149 yen to the 146 yen level underneath has been in effect since the beginning of August. This looks a lot like a market that’s trying to do everything it can to break out. If and when it does, then you’re looking at a move to the 151 yen level next. If it does not, then we may go looking to the 200 day EMA, which is right in the middle of that consolidation region.

AUD/USD Technical Analysis

The Australian dollar continues to struggle, hanging on to gains, as we rallied a bit in the early part of the session, but have given back about half of the gains, just like we did during the previous session. The Australian dollar seems hell bent on going to the 0.6550 level underneath, an area that’s been like a magnet for price and now features a 50 day EMA. Out of all of the major currencies, the Australian dollar was one of the major underperformers through the sell-off of the US dollar for months, so logic dictates that if the US dollar starts strengthening, the Aussie dollar may be in serious trouble.

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