EUR/USD, USD/JPY and AUD/USD Forecast – US Dollar Struggling a Bit on Thursday

EUR/USD Technical Analysis

The euro has shown itself to be somewhat soft in the early part of the session, but it has turned around to show signs of life against the US dollar as the 1.12 level has offered support. Ultimately, this is, as is typically the case with the euro, a lot of choppy behavior. And what we see here is more common than what we had seen previously. If you look in the past, you can see it just really doesn’t have anywhere to be most of the time.

So, with this, I’m watching this 1.12 level very closely because if we can break down below it, then I think the euro really starts to find trouble. If we rally from here above the 1.14 level, then brings the 1.15 level into view, which is a major barrier. So, we might be stuck in this range, at least for the time being.

USD/JPY Technical Analysis

The US dollar initially shot higher against the Japanese yen and then has collapsed. There has been a lot of selling above 146 yen. The question is, can we turn things around? I still think we’re in the midst of trying to reach the bottom. But right now, it’s just so messy that it’s really difficult to get aggressive to the upside. Nonetheless, I do think that there is an opportunity on pullbacks to buy the US dollar due to interest rate differential, which is going to remain sky high, especially as the Japanese are having trouble finding buyers for their bonds again.

AUD/USD Technical Analysis

The Australian dollar is slightly positive, but it’s still just messy sideways trading, really, when you look at this. The 200 day EMA is relatively flat and offers a little bit of support, but the 0.64 level is even more important. Underneath there you have the 0.635 zero level, which should offer support. Clearing both of those to the downside probably opens a trap door trade against the Aussie where we just fall off of a cliff. On the other hand, if we can turn around a break above the 0.65 level, that allows the Australian dollar to go much higher. We did peak above there on Monday, but Monday, of course, was Memorial Day, meaning that there was a serious lack of liquidity.

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