USD/JPY and AUD/USD Forecast - 13 July 2017

USD/JPY

The US dollar had a volatile session on Thursday, as we continue to go back and forth just above the 113 level during the Janet Yellen congressional testimony. With the action that we have seen this week, it appears that the market is trying to roll over a bit, and if we break down below the bottom of the range for the previous sessions this week, I think we will probably go looking towards the 112 level. Rallies at this point still should prove themselves, but I do recognize that longer-term it looks as if we are trying to buy the US dollar over the Japanese yen, and considering that the interest rate situation in America is stronger than Japan, I think longer-term that will happen. However, this market will probably have quite a bit of volatility in the short term.

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AUD/USD

The Australian dollar initially fell during the day on Thursday, falling towards the 0.7550 level. However, we turned around to break out to the upside, and then tested the 0.7750 level. That level is very important, and if we can break above there think that the Australian dollar will break out and reach towards the 0.80 level, which longer-term is a much more important level than what we are testing right now. If we pull back from here, then we simply go back and forth in the short term as consolidation takes over again. Keep in mind that the gold markets have an influence on the Australian dollars well, so if it breaks down, it’s possible that could have a bit of an effect in this pair. Alternately, if gold rallies that will be just another reason for the Australian dollar to start gaining against the US dollar again. Either way, I think waiting for a daily close is probably the best thing you can do.

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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.