USD/JPY
The US dollar rallied during the course of the day on Thursday, as we continue to consolidate off of the 103 support level. If we continue to go back and forth at this point in time, I believe that the market is trying to build up enough momentum to finally break above the 105 level. Once we get above there, I feel that the market will probably try to reach towards the 107 level. Any break down below the 103 level will probably invite more support, as the Bank of Japan continues to be very supportive overall and on the long-term. I am simply looking for short-term pullbacks and show signs of support in order to go long it yet again, and I believe that you will essentially have a bit of a “buy on the dips” type of situation.
AUD/USD
The Australian dollar fell significantly during the course of the day on Thursday, forming a very bearish candle. Because of this, I think we’re going to continue to fall from here, perhaps trying to reach down to the 0.75 level underneath. That is the bottom of the larger consolidation area, which of course extends all the way up to the 0.7750 level above, and that means that the market continues to bang about in this general vicinity. I think that short-term selling will continue, and then eventually there will be buyers at lower levels as we continue to try to find some type of longer-term distance direction.
I will say this, the candle from the session is very long and very impulsive, but we have seen this before so given enough time it’s very likely that you will probably have to follow the gold markets in order to get an idea as to where the pressure will head towards given enough time. Once we break higher, I would expect we would go to the 0.80 level.
