USD/JPY Technical Analysis
The US dollar has skyrocketed against the Japanese yen, although it does seem to be finding a little bit of trouble around the 148 yen level. But nonetheless, remember, people get paid to hold this currency pair. So not only were we forming a bottoming pattern around the 140 yen level, but you were collecting swap along the way. Now that some of the trade tensions seem to be disappearing, it makes perfect sense that this pair would rally.
This pair does tend to rally with risk appetite and risk appetite, according to the stock markets at least, which has gone through the ceiling during the trading session. So, I expect an attempt to get back to the 200 day EMA before it’s all said and done, with the occasional pullback offering buying opportunities.
AUD/USD Technical Analysis
The US dollar has strengthened against the Australian dollar a bit, as the Aussie initially tried to rally in celebration of perhaps Chinese growth due to the trade deal, only to turn around and fall as the US dollar has strengthened against almost everything. At this point, I’m watching the 0.635 zero level because if we break significantly below there, we are going much lower.
On the other hand, if we turn around and take out the 0.65 level to the upside on a daily close, then I think the Aussie has a chance of going all the way to 0.67 followed by 0.69. Remember though, the Australian dollar is highly levered to China, so we’ll have to see how that plays out.
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