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

EUR/USD Technical Analysis

The Euro has gone back and forth in the early hours on Wednesday as we are sitting just above the 1.16 level. The 1.16 level is an area that I think a lot of people will be paying close attention to, as it’s been important multiple times going up and down. We have the 50 day EMA reaching towards the 1.16 level as well. So, I think that’s all ties together for support. The biggest problem, of course, is we just don’t have a lot of momentum. Ultimately, this is a market that I think could be waiting for the Jackson Hole Symposium to get an idea on how Jerome Powell feels about interest rate cuts.

USD/JPY Technical Analysis

The US dollar initially dipped against the Japanese yen but has turned around to show signs of life again. We are above the 50-day EMA and now threatening the 200-day EMA. The 200-day EMA happens to sit at the 148 yen level, an area that has been important multiple times. If we can clear that, then we could go as high as 151 yen. Short-term pullbacks are very likely, but I think they continue to get bought into due to the interest rate differential and the fact that we’ve been grinding higher for a while. This has become more than a pullback, although we don’t have a lot of momentum. This time of year, is typically pretty quiet anyway, so that obviously comes into play.

AUD/USD Technical Analysis

The Australian dollar continues to drift lower, and it looks as if we are going to try to break towards the 0.64 level. If we can clear that to the downside, I do think the Australian dollar becomes one of the first dominoes to truly fall against the US dollar and we could see a plunge. Rallies at this point in time are possible. It certainly would make a certain amount of sense considering we’re in an area that I think ends up being consolidation, but really, at this point, it looks like the 200-day EMA, followed by the 50-day EMA, and then finally the 0.6550 level all offer resistance to any Australian dollar strength.

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