USD/JPY
The USD/JPY pair fell significantly during the course of the day on Thursday, but found enough support below the 108 level to turn things back around right from there. However, it still looks as if we are probably going to be fairly bearish, as the Japanese yen tends to be used as a safety currency. Ultimately, the market should continue to face resistance above, especially near the 110 level. Any rally from here will have to deal with quite a bit of bearish pressure all the way to that level, so I’m looking for an exhaustive candle on a shorter-term chart to sell this market. It is not until we break well above the 110 level that I would be willing to think about buying.
AUD/USD
The AUD/USD pair initially tried to rally during the day on Thursday, but turned right back around to slam into the 0.75 level. This is an area that begins a massive support level and region that extends all the way down to the 0.74 level. Because of this, I am simply waiting to see whether or not we get a supportive candle in this area that I can start buying again. If that’s the case, I would not hesitate to go long as it would represent value and of course show signs of support in a market that has already been very impulsive. Because of this, I am on the sidelines at the moment, but I would not be surprised at all to see this market bounce and reach towards the 0.77 level.
Pay attention to the gold market, because it does tend to drive the Australian dollar, and it looks as if it is trying to find enough support to turn things back around. The 0.74 level below coincides with the $1200 level in the gold market as far as I can tell, and if both get broken to the downside, we more than likely go much lower. Until then, I have to assume that we will still go higher eventually.
