USD/JPY and AUD/USD Forecast - 18 July 2016

USD/JPY

The dollar rose well above the 105 level against the Japanese yen during the day on Friday, but as you can see turned right back around to form a shooting star. I believe this means that we are not ready to go higher, and that we will more than likely pullback a little bit. I don’t necessarily think that the trend is going to change to the downside again, but I do recognize that we could very easily fall to the 103 level in the short-term. On a break below the bottom of the shooting star I think that the sellers will take over for a moment, and quite frankly that’s probably needed after this knee-jerk reaction that had occurred early in the week. On the other hand, if we break above the top of the shooting star for the session on Friday, I think the buyers will jump in and start pushing even harder.

USDJPY

AUD/USD

The AUD/USD pair initially rallied during the day on Friday but turned back around to form a rather negative looking candle. Preceded by a couple of shooting stars, this isn’t necessarily a huge surprise. However, I do feel that there will be a little bit of a soft at the bottom at the 0.75 level that could cause a little bit of support. I’m not saying that we can go below there, quite frankly I don’t think it would take much but I would anticipate that there will be some buyers in that region.

Gold markets looks somewhat healthy lately and this of course can have a positive influence on the Aussie dollar as well. Because of this, I bit hesitant to sell this market for any real length of time, but quite frankly I don’t have any reason to buy it either. I believe that short-term selling is possible, but I would be very quick to take profits if I find myself selling.

AUDUSD

Christopher Lewis

Christopher Lewis has been trading Forex for several years. He writes about Forex for many online publications, including his own site, aptly named The Trader Guy.