USD/JPY, USD/MXN and USD/ZAR Forecasts – US Dollar Drops with Rates in the US

USD/JPY Technical Analysis

The US dollar fell significantly during the early hours on Wednesday to crash through the 156-yen level, test the 200-day EMA, but has since bounced quite a bit actually. So, with that being said, it is worth noting that the interest rates falling in America due to the idea that the Americans and the Iranians might be getting closer to peace still are extraordinarily high in comparison to the Japanese yen.

With that being the case, I think you’ve got a situation where sooner or later the buyers come in to take advantage of cheaper US dollars and it’s worth noting, as you will see across the board here in this video, that a lot of the carry trade type of situation involving the US dollars got stopped dead in its tracks as well.

Maybe this is the market’s initial reaction, but there’s a little bit of hesitation for the market to fully buy into the narrative. We’ll just have to wait and see, but this is one I’m watching. If we can close above 156.50 yen, I might be interested in having another stab to the upside.

USD/MXN Technical Analysis

The US dollar has fallen against the Mexican peso as well, but you can see has bounced a little bit from the lows as we reached pretty significant support in the neighborhood of 17.20. That being said, this is actually one I like shorting, I just don’t like shorting here.

I want to see a bounce towards the 17.45 level, then maybe I will start shorting again. As far as shorting here, I think it’s very difficult to do. If you want to day trade it, which isn’t exactly the easiest thing to do with the Mexican peso, you probably are looking for an upward move.

USD/ZAR Technical Analysis

The US dollar fell against the South African rand to test the 16.25 level, an area that’s been pretty significant support as well. If we can break that, then I think we will drop to 15.8 eventually.

Short-term rallies are probably sold into because of the interest rate differential favoring South Africa, and I would look somewhere right around the 50-day EMA, right around 16.57 and see if there’s signs of exhaustion that you can potentially take advantage of.

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