USD/JPY and AUD/USD Forecast - 16 February 2017

USD/JPY

The US dollar initially rallied against the Japanese yen but found the 115 level to be far too resistive to continue going higher. This was an area that I recognized as resistance previously, so the fact that we formed a shooting star isn’t exactly surprising. However, I believe that this will be a simple pullback that offers buying opportunities based upon supportive candles or bounces below, and I will be looking for opportunities to go long. Alternately, if we break above the 115 handle, I feel the market will continue the moved to the upside, perhaps extending all the way to the 118.50 level over the next several weeks. I have no interest in selling this market, I believe that with the Federal Reserve looking likely to raise interest rates this year, this pair should continue to rise.

USDJPY

AUD/USD

The AUD/USD pair initially fell on Tuesday, but turned around to make a large moved to the upside. We broke above the 0.77 level during the day, and that’s a very positive sign. I believe that we will reach towards the 0.7750 level above, which should be resistive. With the strength of the candle, it suggests that we are going to continue to show the Australian dollar going higher. I believe that the 0.76 level underneath should be supportive, and I believe that pullbacks will offer buying opportunities.

If we break above the 0.7750 level, the market could continue to go much higher and perhaps reach towards an area that has been important several times over the last few years, the 0.80 level. That’s an area that has attracted a lot of attention from the longer-term perspective several times, so it makes sense that we may be attracted to going there again. I think it will be up “buy on the dips” situation into we get to the various levels above.

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.