USD/JPY, USD/CHF and USD/CAD Forecasts – US Dollar Drifting Early on Tuesday

USD/JPY Technical Analysis

The US dollar has gone back and forth during the trading session on Tuesday in the early hours as the 160-yen level continues to be a bit of a barrier that extends all the way to the 160.50-yen level. That’s an area where we’ve seen a lot of selling pressure including the Bank of Japan coming into the picture. I look for short-term dips as a buying opportunity in this market. US 10-year yield dropping a little bit early probably puts some negativity in it, but I think ultimately that turns around.

USD/CHF Technical Analysis

The US dollar is falling against the Swiss franc to test the 200-day EMA for support. I think it will find it somewhere around this area. At the first sign of a bounce, I’m more than willing to buy the right-hand side of the V on maybe an hourly chart, especially if interest rates perk back up.

But ironically if we get a risk appetite inducing rally around the world, perhaps something good happens, that probably sends this pair higher as well. It’s kind of a win-win situation for the dollar given enough time, that’s especially true with the Swiss National Bank out there more than willing to intervene if we see a sudden spike in the Swiss franc’s value.

USD/CAD Technical Analysis

The US dollar is dropping against the Canadian dollar, but one look at the longer-term charts, and you can see that we are right at an area that should be resistance, right around 1.3950, extending all the way to the 1.40 level. With this, I like the idea of shorting here. I don’t look at it as a long-term move, I think this is just a short-term kind of wait and see type of trade, I wouldn’t put a lot into it.

I do think ultimately the US dollar has more strength than the Canadian dollar, but I also recognize that we are overextended. If you are a short-term trader, this might be a nice little opportunity for you. If we were to turn around and break above the 1.40 level, then that could send this market to 1.4150.

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