USD/JPY, USD/CHF and USD/CAD Forecast – US Dollar Moving Early Monday

USD/JPY Technical Analysis

The US dollar has rallied rather significantly during the early hours on Monday, and at this point in time, we are above the 158-yen level, an area that kicks off a lot of resistance all the way to the 160-yen level. Anything above there really gets the US dollar flying against the Japanese yen, and it is worth noting that Japan imports 100% of its oil. This is yet another reason to think that eventually the yen falls pretty drastically as the dollar rises higher.

USD/CHF Technical Analysis

The US dollar has gone back and forth during the session on Monday against the Swiss franc as traders are trying to figure out where the safe haven is. The US dollar has been strong against most currencies, but it did give back some of its strength as we started to head into North America. I think at this point you have to assume that sideways action is going to be the way forward.

The 0.79 level I believe at this juncture is a ceiling that if it gets broken, that’s a sign that we’re going much higher. Otherwise, somewhere around 0.7750, I believe, is the current fair value price.

USD/CAD Technical Analysis

The US dollar has fallen against the Canadian dollar, although it is recovering a bit, and this probably isn’t a surprise as oil spiked. The 1.35 level continues to offer a bit of a floor.

If we were to break down below 1.35 then it opens up deeper selling, perhaps even as low as 1.33. That being said, the United States produces 14 million barrels of oil a day, so the oil component of this pair isn’t what it once was. However, with the medium sour grades in the Middle East offline at the moment, one of the big winners will be Alberta. Although it’s not medium grade, it’s heavy crude, but it’s closer to what we would need to fill, as far as gaps are concerned, in supply.

If Alberta wins, Canada wins. I think you will continue to see probably optimistically a sideways market between 1.35 and 1.3750.