USD/JPY
The USD/JPY pair continued to go lower during the course of the day on Thursday, as this market certainly is showing quite a bit of risk aversion. With the jobs number coming out during the course of the day today, it’s likely that we should get quite a bit of volatility in this market as well as many others. That being said, we have broken down below a significant amount of support at the 118.50 handle, and of course the 118 handle.
Because of this, the market looks as if it could continue to go lower, and quite frankly I think that there are a lot of nerves out there. If we break down below the bottom of the range, I feel that this market will then reach towards the 116 level. It is not until we break above the 118.50 level that I feel it’s possible to start buying this market as it would show a pickup in momentum and a break above what should be resistance.
AUD/USD
The AUD/USD pair continued to go lower during the course of the day on Thursday, and now looks as if it is ready to reach down towards the 0.69 handle. Any rally at this point in time should be a nice selling opportunity as the US dollar continues to strengthen overall, and of course the Australian dollar is very soft overall. That being the case, I feel that rallies will attract quite a bit of selling pressure as the commodity markets in general are soft. On top of that, we have the jobs number coming out and that of course will rattle markets one way or the other. A strong jobs number could increase the demand for the US dollar, but a week jobs number may also drive this pair down as it will make a bit of a flight from risk. Either way, I believe that selling the AUD/USD pair is the only way to go.
