EUR/USD, USD/JPY and AUD/USD Forecasts – Currencies on Hold at the Moment

EUR/USD Technical Analysis

The Euro has been ever so slightly positive in the early hours of Thursday as we continue to see a lot of noisy behavior. We are sitting just below the 200-day EMA, which of course attracts a lot of attention in and of itself, but I also recognize that we are in the middle of a somewhat tight range and therefore I expect a little bit of compression here, maybe some hesitation as we really don’t have much on the calendar except for weekly unemployment claims in the United States and unfortunately we are on social media post watch to find out what people are going to be doing in the Middle East.

I think it’s kind of a quiet wait-and-see market, but if we can break above the 50-day EMA, it would be very bullish, perhaps sending the Euro to go looking into the 1.18 level. If we break down from here, the 1.14 level is your target.

USD/JPY Technical Analysis

The US dollar is very quiet against the Japanese yen as we continue to threaten the crucial 160-yen level. The 160 yen level, of course, is an area where we’ve seen some verbal intervention previously, and this has created a little bit of a barrier that the Bank of Japan will be creating.

The question now is whether or not we can continue to go higher anyway because of the interest rate differential. I suspect we can, and if and when we break above the 160.40-yen level, that will be a major breakout that goes all the way back to 1990, so it’s certainly worth watching. If we do pull back from here the 158-yen level seems to be support.

AUD/USD Technical Analysis

The Australian dollar is grinding its way down towards the 0.69 level. This is an area that’s very important. If we were to break down below there we would probably drop 200 pips.

The Aussie, of course, is supported by a more hawkish Reserve Bank of Australia than many other central banks, but the Federal Reserve is likely to remain firmly on hold at least for the next several months, and there’s no real clarity as to when rate cuts would be coming. So, a little bit of a correction to the downside wouldn’t be completely unexpected. However, if we hold that area then a short-term bounce back towards the 50-day EMA near the 0.70 level would be what I would expect.