EUR/USD, USD/JPY and AUD/USD Forecast – US Dollar Softens Early on Wednesday

EUR/USD Technical Analysis

The euro rallied a bit during the trading session on Wednesday in the early hours, but at this point in time, I think we are running into an area that could cause a little bit of trouble. A pullback from here does make a certain amount of sense, and if we do pull back from here, we will have to watch the 1.13 level and then the 1.12 level.

The 50-day EMA is also rising towards this area, but we still see a little bit of oversold condition in the US dollar, and it’s worth noting that we are right in the middle of a cluster that’s been important a couple of times going back. So, I’m a little ambivalent about going long the euro at the moment. And if we break down below the 50 day EMA, I think we just simply go back into the range that we had been in for so long.

USD/JPY Technical Analysis

The US dollar has fallen pretty significantly during the early hours on Wednesday against the Japanese yen, which partially is due to the fact that the interest rates in Japan are spiking all of a sudden. In fact, Japanese government bonds have literally had no bids for two days. What this means is eventually the Bank of Japan is going to have to step in and drive yields down.

So, this is a market that I’m looking at very closely because it hasn’t broken yet. But if and when the Japanese come in and start doing yield curve control, that will put the yen on the back foot. In the short term, we have a lot of support right in this general vicinity. So, although I want to get long of this market in the long term, I’m waiting for that momentum candle.

AUD/USD Technical Analysis

The Australian dollar has rallied a bit during the trading session on Wednesday in the early hours, but it also looks like we are struggling. I think quite frankly, this is a market where money went to die. There’s just nothing here, and we’re stuck in the same range that we have been in for quite some time. If you are a short-term trader, then you like this setup because the 0.6350 level underneath offers massive support, while the 0.65 level above offers massive resistance. As we continue to chop back and forth, again, if you’re a short-term trader, this is your market. If you’re looking for a bigger trade, we have to break out of this consolidation area first.

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